(Reuters) -Germany's Rheinmetall and U.S. firm Lockheed Martin ( LMT ) have agreed to expand their cooperation and extended a memorandum of understanding signed in 2024, they said in a joint statement on Wednesday.

The two defense groups will set up what they call a "center of excellence," led by Rheinmetall, which will manufacture rockets and missiles and will operate in Germany and other European countries, they added.

"Rheinmetall will not only be involved in sales but will also contribute significantly to the production," Chief Executive Armin Papperger said in a statement.