VMZ-Sopot, Bulgaria’s state-owned arms manufacturer, is set to partner with Rheinmetall, the largest defense company in Europe, for the joint production of NATO-standard 155 mm artillery shells on Bulgarian territory. The details are outlined in a recent government assignment, as reported by Bulgarian National Radio.

The plan involves forming a consortium in which Bulgaria will contribute €960 million. The funding for this participation is expected to come from the European Union’s SAFE mechanism - designed to bolster European defense capabilities and security infrastructure.

The joint venture between VMZ-Sopot and Rheinmetall will include two main facilities: one for the production of energetic materials and explosive charges, and another dedicated to manufacturing 155 mm artillery shells. These munitions are standard within NATO forces and are compatible with the new howitzers that Bulgaria intends to acquire from France. The Ministry of Defense has therefore expressed support for the project, linking it directly to Bulgaria’s upcoming procurement plans.

Economy Minister Petar Dilov described the deal as a significant initial step toward launching a long-term partnership. He noted that negotiations with Rheinmetall have been ongoing and intensive over the past several months. According to Dilov, the project is expected to help consolidate supply chains and reinforce Bulgaria’s role in European defense production.

Although the focus is on meeting Bulgaria’s military needs, the shells will also align with broader NATO standards - making them relevant to ongoing defense efforts across Europe, including in Ukraine. In 2023, it was reported that VMZ (Vazovski Mashinostroitelni Zavodi) had begun marketing 155 mm ammunition. At the time, Bulgaria’s Ministry of Defense clarified that only two private companies in the country were licensed to produce that caliber. The new project would expand domestic capability in this area under a state-backed consortium.

Technology transfer from Rheinmetall is also part of the agreement, which will allow Bulgaria to acquire know-how in advanced munitions manufacturing. The production facilities are expected to generate new jobs, contributing to the regional economy around Sopot.

VMZ-Sopot has reported a sharp rise in orders this year. In the first quarter alone, the company secured sales worth over 296 million leva - significantly more than the 191.7 million leva it recorded for the entire year of 2021. The company also projected that its total orders for 2025 would reach 1 billion leva. The partnership with Rheinmetall is seen as a strategic development that positions VMZ-Sopot more firmly within the European defense supply network.