Italy is in discussions with German company Rheinmetall for a deal worth 20 billion euros.

The deal involves acquiring over 550 tanks, including 350 Lynx infantry combat vehicles and more than 200 Panther battle tanks over 15 years.

Rheinmetall did not deny the report, and there are talks of a strategic alliance with Leonardo for tanks.

The Italian government has not commented on the matter.

This potential partnership follows Italy's unsuccessful negotiations with KNDS Deutschland for Leopard 2A8 tanks.

Rheinmetall's shares surged 3.5% in response to the news.

The company aims for record sales amidst increased defense spending in Europe driven by conflicts like the one in Ukraine.

The deal is expected to significantly impact the arms industry, with further details anticipated in the future.