Kongsberg Seals Ownership Stake In U.S. Missile Manufacturer

BERLIN—Norwegian missile manufacturer Kongsberg completed the acquisition of a 90% stake of U.S.-based Zone 5 Technologies, adding a maker of low-cost cruise and interceptor missiles already in large-scale production, the companies announced June 10 at the ILA Berlin air show.

  

Kongsberg revealed the acquisition agreement in December after deciding that buying Zone 5 offered the fastest route to market for low-cost munitions with still a high level of performance, said Harald Aarø, Kongsberg’s executive vice president for business development and strategy, during a show news conference.

 

“Technically, could we be capable of doing it? Yes, but we are not as capable, as we will probably spend a longer time, and perhaps not strike as smart solutions,” Aarø said. “That doesn't mean that our engineers aren’t just as smart. Our engineers are just as smart, but on a different sports field, so to speak.”

 

Zone 5’s rapid rise in the low-cost munitions market has been fueled by the Rusty Dagger cruise missile and the White Spike missile interceptor. Both are now in the first year of large-scale production, with deliveries of 1,000 each projected by the end of this year, said Tom Kanewske, Zone 5’s chief strategy officer.

 

Both weapons will now join Kongsberg’s comparatively exquisite portfolio of the Joint Strike Missile and Naval Strike Missile, with each several times larger and more expensive than the Rusty Dagger.

 

The original leadership team will continue to manage Zone 5 as an independent U.S. subsidiary under a proxy agreement, which is a special legal structure commonly used with foreign-owned businesses involved in national defense.

 

Kongsberg now provides Zone 5 with a national champion in a fast-growing European market. The Extended-Range Attack Missile version of the Rusty Dagger is already being supplied to the Ukrainian Air Force.

 

Zone 5 offers a turnkey solution for foreign governments to build the missile at scale in their own country, Kanewske said. Different versions of the missile can be launched from the ground, cargo aircraft or fighters.

 

“The same baseline cruise missile is field-retrofittable for all employment modes,” Kanewske said. “That puts us in a very unique space, and that a country and their [military] services are able to purchase the same munition and field-retrofit for that to be surface-launched, whether from land or the deck of a ship, or pylon-launch from a fighter aircraft or palletized.”