German defense giant Rheinmetall has signed an official agreement with the Bulgarian government to construct two separate factories in the country: one for gunpowder production and another for 155 mm NATO-standard artillery shells. The facilities will be built in Sopot, southern Bulgaria, at the site of the state-owned VMZ ammunition plant.
The investment, valued at approximately €1 billion, represents one of Bulgaria’s largest industrial projects in recent years. Once completed, the factories are expected to create around 1,000 new jobs.
The signing ceremony in Sofia was attended by Bulgarian Prime Minister Nikolay Denkov and Rheinmetall CEO Armin Papperger. The contract was signed by Roman Kohne, CEO of Rheinmetall’s Weapons and Ammunition Division, on one side, and Ivan Getsov, Executive Director of VMZ Ammunition Factory, on the other.
The ceremony also included Deputy Prime Minister and Minister of Innovation and Growth Tomislav Donchev, Minister of Economy and Industry Peter Dilov, GERB Party Chairman Boyko Borissov, and Germany’s Ambassador to Bulgaria Irene Maria Plank.
Prime Minister Denkov stated, “It is a great pleasure to welcome Rheinmetall CEO Armin Papperger to Sofia. This agreement with Europe’s largest defense manufacturer is a historic step for the modernization of Bulgaria’s and Europe’s defense industry.” He also highlighted the speed of negotiations, saying, “We achieved this together, and I believe our cooperation will continue with the same success.”
The new factories will not only strengthen Bulgaria’s domestic defense production capacity but also help meet growing ammunition demand in Europe. Following the Russia-Ukraine conflict, European nations are actively replenishing ammunition stocks, and this project aligns directly with the European Union’s objectives to expand ammunition production capacity.
Rheinmetall has also been expanding its production network across Europe, establishing ammunition and gunpowder facilities in Germany, Lithuania, Latvia, Romania, and Hungary. The two new factories in Bulgaria, located at the Sopot VMZ site, will serve as a central hub for Eastern Europe within this strategic network.
Once completed, Bulgaria will not only enhance its national defense capacity but also become a critical supply center for Europe’s ammunition production.
