The Canadian government has picked Germany’s TKMS to build this country’s first significant submarine fleet, siding with NATO allies and Europe over Asian defence contractor Hanwha.

Prime Minister Mark Carney announced the decision in Halifax Monday, bringing an end to a closely fought campaign over the last 10 months that saw both South Korea and Germany outbidding each other in terms of the economic benefits they would bring to Canada.

The decision means Canada is handing a contract for as many as 12 submarines to Germany’s TKMS, which bid for the contract jointly with Norway. Both countries as well as Canada are members of the North Atlantic Treaty Organization, a Western military alliance that dates back to 1949. South Korea is not a member of NATO.

News of the Canadian government’s submarine pick had been closely guarded. Two sources said Ottawa required some staff involved to sign nondisclosure agreements before the announcement. One said it was deemed necessary because of the size of the procurement and the commercially sensitive nature of a deal that affects publicly traded companies. The Globe is not identifying the sources who were not authorized to speak publicly about the matter.

Shares in TKMS rose as much as 12.9 per cent on advance reporting of the Canadian decision, hitting their highest level in nearly four months.