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Armin Papperger created a stir both in Russia and the west this year when he said he wanted German arms group Rheinmetall to build its Panther tanks on Ukrainian soil.
Berlin had been pushing back for months against international pressure to send German Leopard II tanks to Ukraine for fear of escalating the conflict — now the chief executive of the country’s biggest defence contractor was drawing the wrong kind of attention.
Dmitry Medvedev, the former Russian president who now serves on Vladimir Putin’s security council, issued a veiled threat to destroy the proposed plant that would make the Panthers, vowing to welcome it with “salutes” from Kalibr missiles and “other pyrotechnic devices”.
But defence executives in Germany privately dismissed the plans as a publicity stunt. “Typical Papperger,” said one at the time, hinting at the 60-year-old’s reputation for controversy.
The episode sums up Papperger’s rise as a kingpin in Europe’s military efforts alongside Rheinmetall, which since Russia’s invasion of Ukraine has gone from a company investors barely wanted to touch to a darling of the Dax index of Germany’s 40 biggest companies.
The Bavarian, an avid hunter, has acknowledged the war has “ushered in a new era” for the Düsseldorf-based group, which he joined in 1990 after an engineering degree and has headed for a decade. Rheinmetall shares have jumped more than 150 per cent since Putin launched the assault in February last year, as investors flock back to the industry in anticipation of a surge in European defence spending.
Rheinmetall this week announced its latest deals — contracts for military vehicles and munitions worth almost €6bn, most of which came out of the €100bn military fund pledged by German chancellor Olaf Scholz last year as he proclaimed a Zeitenwende, or “turning point”, in the country’s foreign and defence policies.
Papperger has used his new prominence to become one of Europe’s most outspoken defence executives, frequently criticising Berlin and other governments for not placing enough orders for Ukrainian military equipment.
But people who know him say Papperger has always had a forthright demeanour. One described him as a “larger-than-life character”, while another said he had an “old-fashioned view on power” and was “really charming but can be very aggressive”.
“His personality hasn’t changed — what’s changed is he’s now on the global arena,” said one of the people.
Papperger’s willingness to court attention contrasts with the heads of rival German defence contractors such as Diehl and Krauss-Maffei Wegmann, which are family-owned companies that keep a relatively low public profile.
His unguarded comments have stoked tensions with KMW. After Papperger told a Swiss newspaper that Rheinmetall controlled rights to some of the older models of the Leopard II, the Munich-based group — the tank’s original developer and one of Rheinmetall’s main partners on key products — filed a court injunction. But minutes before the two companies were scheduled to meet in court in May, Rheinmetall stood down and withdrew Papperger’s claim.
The animosity between the companies stretches back years, according to industry insiders who say previous attempts by Rheinmetall to take over KMW soured relations between their top executives.
Another person who used to work with Papperger said that while his outspoken style frustrated many of the companies Rheinmetall collaborated with, it had become “the standard that people have come to expect these days”.
Papperger was not available for comment.
Alexander Wahl, analyst at Stifel, described Papperger as an “aggressive” communicator on growth targets even before the war and said “investors know that well”.
More recently, the company hinted it would start making compressors for heat pumps — a technology set to boom in Germany after the government announced it wanted to ban the installation of new oil and gas boilers.
While Papperger has stepped on the toes of some in the historically secretive defence sector, one industry executive said “he has a very good sense of business, and he is well-respected in the industry for that”.
After his comments about building tanks in Ukraine, Rheinmetall in May announced a “strategic partnership” with Kyiv-owned defence contractor Ukroboronprom that it said would “build a bridge between Rheinmetall and the existing state defence industry in Ukraine”.
The joint venture’s initial focus would be repairing military vehicles returned from the front line but an unspecified “later phase” would include it making “select Rheinmetall products”.
The German press has noted that Papperger, who was paid €5mn last year, has ample incentive to keep Rheinmetall’s share price high. The Frankfurter Allgemeine Zeitung in February calculated that the value of his shares in the company had risen by €30mn since the start of the war.
The publicity Papperger attracts may be good for dealmaking for a company whose every transaction has to be approved by Berlin because of the country’s military export rules.
“Back in the day, if you wanted to get a deal signed off, you had to be humble and heads-down,” said one person close to the company. Citing Rheinmetall’s use of statements to the press to heap pressure on Berlin to send more military equipment to Ukraine, he added: “That has changed now.”
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