Levent Kenez/Stockholm
Turkish firm Baykar, a defense contractor owned by the son-in-law of Turkish President Recep Tayyip Erdogan, has signed a preliminary agreement to acquire Italy’s Piaggio Aerospace on January 27, marking a significant step in its international expansion . The deal, approved by Italy’s Ministry of Enterprises and Made in Italy in December 2024, involves the transfer of Piaggio Aero Industries and Piaggio Aviation’s business operations to Baykar. Pending additional approvals, including from the Italian Council of Ministers, the transaction is expected to conclude by spring.
According to an analysis by Turkey’s state-run Anadolu news agency, Baykar’s acquisition of Piaggio Aerospace represents a strategic response to long-standing trade and export barriers faced by Turkey in the defense sector. Unlike conventional industries, the defense industry requires navigating complex regulatory frameworks and diplomatic relationships, often influenced by geopolitical considerations.
Anadolu reported that Turkey has frequently encountered embargoes which restrict the export of its defense products, even when such products are developed domestically. One significant hurdle has been the insistence of some countries on local manufacturing as a precondition for procurement. By acquiring an EU-based company like Piaggio Aerospace, Baykar aims to bypass these restrictions. Defense products manufactured in Italy can be more readily integrated into European markets, eliminating legal and logistical obstacles tied to non-EU imports.
This acquisition also aligns with Turkey’s broader strategy of overcoming embargoes through domestic innovation and international partnerships. While Turkey has successfully built a self-sufficient defense industry, this deal allows Baykar to complement its production capabilities with improved access to European customers.
Nordic Monitor previously reported that Erdogan tied the Turkish parliament’s approval of Sweden’s NATO membership to Canada lifting its arms embargo on Turkey. Speaking to pro-government journalists during his return trip from Hungary on December 19, 2023, Erdogan said US President Joe Biden had suggested resolving congressional reluctance to sell F-16 fighter jets to Turkey in exchange for Sweden’s NATO accession. However, Erdogan added another condition: the removal of Canada’s restrictions on defense-related exports to Turkey, including crucial optical equipment used by Baykar, his son-in-law Selçuk Bayraktar’s military drone company.
The Canadian government had imposed an arms embargo on Turkey in 2021 following the use of Turkish-made military drones in the 2020 conflict between Azerbaijan and Armenia in the Nagorno-Karabakh region. The embargo included the WESCAM MX-15D EO/IR FLIR system, a critical component for Baykar’s Bayraktar TB2 drones. Selçuk Bayraktar, the owner of Baykar Makina, which produces the widely used unmanned aerial vehicles, had previously claimed that they no longer needed these Canadian products. However, Baykar had resorted to methods such as having the required components supplied by the country purchasing the drones and assembling them locally in order to circumvent the embargoes.
The Turkish government has long claimed that restrictions and sanctions imposed by NATO allies, particularly the United States and Germany, on Turkey’s arms purchases have hindered the country’s ability to meet the alliance’s defense spending target. During a press conference on July 8, 2023, ahead of the NATO summit in Vilnius, President Erdogan expressed frustration with these embargoes, saying they were preventing Turkey from meeting the 2 percent defense spending goal. Erdogan pointed out that Turkey’s defense spending had decreased from 2 percent in 2019 to around 1.30 percent since some NATO allies were imposing restrictions.
Selçuk Bayraktar recently appeared on Forbes’ latest billionaire list, one of the 27 Turkish billionaires who made it onto the prestigious list. Bayraktar’s net worth stands at $1.2 billion, securing him the 2,465th spot on the list. His brother, Haluk, who serves as CEO of Baykar, follows closely behind, ranking 2,619th with a net worth of $1.1 billion.
Selçuk Bayraktar has a majority share of 52.5 percent in Baykar, where he also holds the position of chairman and serves as the company’s chief technology officer. Haluk Bayraktar has a 47.5 percent stake in the company.
Established by their father Özdemir Bayraktar in 1984 to manufacture parts for the Turkish automotive industry, Baykar has seen significant growth. In 2022 the company recorded sales of $1.4 billion, and by 2023, its exports had soared to $1.8 billion, primarily driven by contracts secured with various militaries across Europe, Africa and the Middle East.
Baykar’s drones have been exported to over 30 countries and were used in conflicts in Nagorno-Karabakh between Armenian and Azerbaijani forces in 2020 as well as in Libya and Ukraine. Many credit the company’s success to the support of President Erdogan, who often promotes Baykar drones during his diplomatic visits abroad, resulting in multimillion-dollar agreements.
Selçuk Bayraktar has been married to Erdogan’s daughter, Sümeyye, since 2016.
There is a strong public belief that the rapid increase in the wealth of the Bayraktar brothers and their attaining billionaire status at such a young age was greatly influenced by their familial ties to Erdogan. However, according to pro-government groups, Selçuk Bayraktar is regarded as a national hero.
He said on a television program in 2022 that Turkey’s drone and unmanned aircraft projects would fail if there were no political backing, putting his support behind the current government before elections in 2023.
President Erdogan sees Baykar as a family business and markets its products in many countries, especially in Africa. It is no secret that Erdogan, his family members and his business associates benefit immensely from the defense industry and military equipment sales. Baykar takes advantage of all state facilities but also earns high profits in the local and international market with the sale of weapons, for which the only decision-maker is Erdogan. An important reason for choosing Turkish drones is that Turkey does not have a long export approval process, unlike the US and the European Union.
The approval of the major defense industry deal between Turkey and Italy is currently pending the approval of the Italian Council of Ministers. However, given the current state of relations between the two countries, it is not expected to face significant hurdles. The strengthening of ties between Turkish President Erdogan and Italian Prime Minister Giorgia Meloni, particularly due to Erdogan’s stance on immigration policy pleasing Rome, has fostered closer cooperation.
The last notable communication between the two leaders occurred on January 10, 2025, when Erdogan and Meloni spoke on the phone. During the call Erdogan suggested that Italy could lead the way in lifting sanctions on Syria, thus facilitating the country’s reconstruction process.
According to the statement released by Erdogan’s office, the two leaders discussed bilateral relations as well as regional and international issues. Erdogan emphasized the substantial increase in trade between Turkey and Italy, stating that the trade volume had reached $32 billion in 2024. He further expressed optimism that with continued efforts to strengthen trade and investment relations, this figure could grow even more in the coming years. Additionally, Erdogan conveyed Turkey’s willingness to enhance cooperation with Italy, especially in such sectors as the defense industry and energy, underlining the growing potential for collaboration between the two nations.
Meanwhile, Baykar has been in close contact with Italian Leonardo, the second-largest defense company in Europe and the 13th-largest in the world, according to the Stockholm International Peace Research Institute, raising the possibility of a new collaboration or partnership between the two companies. In response to the question of whether his recent visit to Baykar signals the beginning of a potential partnership, Leonardo’s CEO, Robert Cingolani, told Anadolu, “I can confirm this, but I cannot provide further details due to certain reasons. However, I can confirm that we are holding discussions to assess whether industrial synergy can be established. Both parties are very interested, and we are satisfied with the progress of these talks.”
