The Düsseldorf-based armaments group Rheinmetall wants to do more business with the American military by acquiring the US supplier Loc Performance.

Rheinmetall is paying 950 million dollars for the company from Plymouth in the state of Michigan, as the Dax company announced on Tuesday evening. "Through the acquisition of Loc Performance, the Group is expanding its business with the US military, increasing its industrial base in the USA and creating further access for its technologies in North America," the press release stated.

Rheinmetall hopes that this will open up more opportunities for orders in the world's largest defense market. With Loc and its approximately 1,000 employees, the company can expand both its product range for military vehicles and its local production capacity, which is important to the US government. Loc operates four plants in the states of Michigan and Ohio, where it says it manufactures drivetrains, suspensions, track systems, rubber and armor products as well as structures for vehicle platforms. Loc's customers include the military as well as the construction and agricultural industries.

The takeover is intended to give Rheinmetall an advantage in the battle for two major contracts in the USA: In the XM30 program for the construction of a new generation of infantry fighting vehicles, the Group is one of two participants in the prototype phase. This involves 4000 infantry fighting vehicles for 45 billion dollars. Rheinmetall is also hoping to be awarded the contract for the "Common Tactical Truck (CTT)" program for 40,000 military trucks worth around 16 billion dollars.

(Report by Alexander Hübner, edited by Philipp Krach. If you have any queries, please contact our editorial team at berlin.newsroom@thomsonreuters.com (for politics and the economy) or frankfurt.newsroom@thomsonreuters.com (for companies and markets).)