Under the agreement, the companies will work toward building a common supply chain and improving product delivery.
Steyr Mannlicher designed the AUG 5.56-caliber assault rifle used by Austrian forces. Australia's military adopted the rifle, with Thales Australia manufacturing it and developing it further.
"This agreement represents the continuing evolution of our Soldier Systems business," said Thales Australia Chief Executive Officer Chris Jenkins. "Steyr Mannlicher has a long history and a global market outlook which, combined with our expertise delivering and upgrading infantry weapons, will allow us to collectively build on our vast knowledge and networks to offer streamlined, cost-effective solutions to customers.
"Both companies employ world-class weapon designers and experts, and our combined capabilities will make this a compelling team. We have invested significantly in weapon development in Australia, and are eager to offer Australian innovations through Steyr Mannlicher to the rest of the world."