Czech arms maker Czechoslovak Group (CSG) has launched licensed production of large-caliber ammunition in Ukraine with local partner Ukrajinska Bronetechnika, it said on Thursday.

Axar.az informs, citing Reuters, soaring demand for ammunition and military equipment since Russia’s full-scale invasion of Ukraine in 2022 has driven rapid growth for CSG, which is considering an initial public offering that could value the group at tens of billions of euros.

“We are proud to be one of the first Western companies to successfully transfer large-caliber ammunition production to Ukraine,” David Chour, vice chairman of the board, said in a statement.

Under the deal, which was announced a year ago and in which CSG provides the license and know-how, initial production capacity will be 100,000 rounds of 155 mm ammunition and 50,000 rounds of 105 mm ammunition per year. It is expected to increase in the coming years, CSG said.

The company took a leading role in a Czech initiative to supply hundreds of thousands of shells to Ukraine. However, it is unclear whether this drive will continue under the incoming government of populist billionaire Andrej Babis.