Italy approves drone production partnership between Leonardo, Türkiye's Baykar

Italy has approved a planned joint venture between defense company Leonardo and Turkish drone manufacturer Baykar to develop and produce next-generation unmanned aerial systems, according to a report Wednesday by Italian daily Il Messaggero.

Italy's Council of Ministers cleared the deal under the country's "Golden Power" rules, approving the establishment of a 50-50 joint venture between Leonardo and Baykar, subject to a number of conditions and requirements, the newspaper reported.

"Golden Power" rules allow the Italian government to review and impose conditions on investments involving strategically important sectors such as defense and national security.

The partnership will focus on the development and production of "next-generation remotely piloted aerial systems."

The approval, backed by Defense Minister Guido Crosetto, came ahead of a regulatory deadline, according to the report.

Among the conditions attached to the deal, international business activities must be directed only toward countries aligned with EU and NATO policies in order to safeguard Italy's strategic interests and ensure supply-chain continuity.

Italian intelligence agencies also requested measures to protect classified information and sensitive technologies involved in the venture, aiming to reduce the risk of losing national technological capabilities, the report said.

For Leonardo, the agreement provides access to a drone market the company estimates will be worth 100 billion euros ($115.9 billion) over the next decade.

For Baykar, one of the world's leading drone exporters, the partnership is expected to strengthen access to European defense markets through Italy's industrial base.

According to earlier statements cited by the newspaper, facilities in Ronchi dei Legionari, Turin, Grottaglie and Rome Tiburtina are expected to take part in the cooperation.

The government's approval followed a brief discussion at a Council of Ministers meeting attended by senior officials, including Foreign Minister Antonio Tajani and Crosetto, the report said.

The agreement is now operational, according to Il Messaggero.

Leonardo and Baykar signed a memorandum of understanding in March last year to establish the joint venture, which was formally launched in June 2025 under the name LBA Systems.