18 Jan 19. Chemring takes hit after fatal explosion at factory. Chemring, the defence company, has suffered a £105m loss after the death of one of its workers in an explosion at its factory in Salisbury. Last summer’s explosion at the plant, which produces countermeasures from unstable chemicals almost exclusively for the Ministry of Defence and BAE Systems, the jet fighter manufacturer, was the fourth in 19 years at Chemring factories around the world. The company was founded in 1905 as the British Foreign & Colonial Automatic Light Controlling Company to make street lighting. By the 1950s it specialised in a silver-coating process used to make radar reflectors that was adapted for chaff systems used by aircraft to stop missiles locking on to them. Chemring reduced revenues by £22m and profits by £17m in its countermeasures divisions in its latest annual results. In addition, the company booked nearly £13m of legal costs from the regulatory investigations into the death and safety at the Salisbury plant. Acquisitions, disposals and restructuring costs reduced profits by another £12m, to which were added writedowns of £20 m in the value of its operations. There was also the £1.7m cost of the departure of the chief executive Michael Flowers, whose successor Michael Ord joined ten weeks before the Salisbury fatality. Chemring took a £71m loss on the sale and closure of other businesses, which added up to £131m of exceptional items, reversing the underlying pre-tax profits of £25 m for the year to October 31 to a £105m loss. On a reported basis the £25m of pre-tax profits before the red ink represented a 30 per cent fall on the £36m comparative figure in 2016-17. However, investors had been forewarned of the issues and the dividend remained intact, rising by 10 per cent to 3.3p per share, but the stock closed at 155p, down 2½p, or nearly 2 per cent, at a two-year low. Mr Ord said the business was making “financial and operational progress”. The order book ended the year up from £325m to £394m. Peel Hunt, the stockbroker, said it was backing the new management to produce pre-tax profits of £40 m this year and £53m the year after. “The new team is making good progress but there is a long way to go.” (Source: The Times)
17 Jan 19. Babcock chairman Mike Turner to step down in July. The chairman of British engineering firm Babcock (BAB.L), Mike Turner, will step down in July, the group said on Thursday, after a decline in its share price and company warnings that income from nuclear decommissioning would fall sharply. Turner said in a statement he took the decision himself because he wished to comply with good corporate governance after a decade as chairman. Babcock, whose biggest customer is Britain’s Ministry of Defence, has had to allay doubts about its financial health, management and its key customer relationships in recent months. Its shares have fallen 14 percent in the past three months versus a 3 percent fall in Britain’s FTSE main share index. (Source: Reuters)
17 Jan 19. Suntuity AirWorks Acquires BirdsiVideo. Suntuity AirWorks has announced the acquisition of BirdsiVideo and Osprey Assessments, two of the largest UAS dealer and services networks across the United States. The acquisition will enable BirdsiVideo and Osprey Assessments to leverage the length and breadth of the Suntuity Group of Companies which includes financial, software, energy, infrastructure, and data collection solutions for commercial and government entities across the globe. It will also further enable the expansion of BirdsiVideo’s existing dealer base with turnkey deployments including drone leasing, drones as a service, and business analytics.
“We see the opportunities created to be limitless,” said Dan Javan, President of Suntuity AirWorks. “The scope of our drone and UAV capabilities through this strategic acquisition will support several new business verticals with end-to-end customized solutions for a multitude of industries.”
“Suntuity has a lengthy resume of servicing commercial and government entities in several countries around the world,” said Josh Kneifel, President of BirdsiVideo. “Our technology services will enhance an already successful business and help further expand its offerings to improve operations across multiple industry verticals.”
Suntuity AirWorks is the UAV and Drone services division of the Suntuity Group of Companies, with drone and UAV service offerings in multiple countries and across the US. Its hardware and software platforms deliver state of the art industry-specific solutions from DJI, FLIR, Berkley and other reputable organizations.
BIRDSiVIDEO is a Franchise 500 ranked commercial drone service company with a network of franchise and affiliate pilots servicing UAS needs nationwide, and outside the US. Founded in 2014, BIRDSiVIDEO offers energy, agricultural, and infrastructure inspections using both high definition and thermographic imagery to collect data necessary to their clients. (Source: UAS VISION)
15 Jan 19. Aria Insights Launches To Turn Drone Collected Data Into Actionable Intelligence With A.I. From the team at CyPhy Works, Aria Insights is launching to better analyze the massive amount of data drones collect to provide greater safety insights and higher quality intelligence to the public safety, oil & gas, and other commercial sectors. Aria Insights, a company on a mission to provide autonomous, robotic teammates, has launched today. Using artificial intelligence (AI), Aria is more effectively harnessing data collected by drones and keeping users safe in the process. Founded by the team at CyPhy Works, Aria Insights is expanding upon CyPhy’s tethered drone legacy by integrating AI and machine learning software into its drones. The company will provide customers with intelligent, autonomous drones that both collect and analyze data to create actionable insights for users. The decision to place an increased focus on artificial intelligence comes from years of industry experience identifying that the power of drones is limited only by the use and understanding of the data they collect.
Aptly named after a flock of canaries, who used to work to keep coal miners safe from deadly gases, Aria Insights deploys drones and AI to remove humans from unsafe situations. Smarter data collection and machine learning enable decision makers to quickly and efficiently address a problem or execute a mission, while ensuring human lives are not put at risk. With sophisticated analytics, decision makers no longer need to spend hours capturing and watching video; instead, Aria Insights’ robots will identify information of interest, send an alert when new information is detected, and ultimately connect all of the data to a digital 3D map.
“After 10 years of innovating and redefining drone technology, the team at CyPhy saw the limitations facing the industry – namely the complications and risks of retrieving and analyzing data,” said Lance Vanden Brook, CEO of Aria Insights. “A number of our partners were collecting and housing massive amounts of information with our drones, but there was no service in the industry to quickly and efficiently turn that data into actionable insights. Moving beyond just a hardware provider, Aria is now a full-service solution that not only meets customers’ aerial needs, but also processes analytics that enable insightful decision making.”
Aria Insights’ new machine learning capabilities enable users in the public safety, oil & gas, and other commercial sectors to collect data and turn it into actionable plans. Equipped with artificial intelligence capabilities, Aria’s drones will perform fully autonomous missions to make it easier to identify features of interest across multiple use cases. For example, its drones can aid in the maintenance of confined spaces, such as oil tankers or pipelines, enabling operators to identify areas that need repair without sending humans into potentially dangerous working conditions. Aria’s drones can also monitor the development of a natural disaster and alert first responders of increased action in a certain area, as well as notify event organizers when portions of a crowd may need more supervision.
Amy Villeneuve, Chairman of the Board at Aria Insights, said: “Our history as CyPhy Works has enabled us to propel our business to new heights with the launch of Aria Insights. The same group of talented, innovative thinkers who delivered best-in-class tethered drone technology and autonomous flight at CyPhy will continue to push the bounds of the drone industry at Aria. Building upon our past success and knowledge, Aria Insights provides commercial markets with a full-service drone solution that combines the power of autonomy and machine learning to change the landscape of the drone industry.”
CyPhy’s flagship product, the Persistent Aerial Reconnaissance and Communications platform (PARC™), will continue to be available from Aria Insights. Aria also plans to launch new technology to solve the needs of its commercial partners and ensure greater safety of people everywhere.
About Aria Insights
Aria Insights is on a mission to provide autonomous robotic teammates that can enter logistically difficult and potentially dangerous environments to collect essential information while keeping users safe. Founded by the team at CyPhy Works, Aria Insights combines artificial intelligence (AI) with autonomous drones to both collect and analyze data. As a full-service provider, Aria Insights ensures that the public safety, oil & gas, and other commercial sectors have safe access to higher quality information that enables insightful decision making on everything from facility maintenance to crowd control. For more information, visit http://www.ariainsights.com/.
15 Jan 19. BAE upgraded to ‘Equal Weight’ by Barclays as it backs firm as “defensive income investment.” The bank said a “material” order book growth forecast for 2018, an improving cash profile from “longer-cycle phasing” in 2020, a 5% dividend yield, and an “undemanding value” with a 20% discount to US peers all backed the defence firm as an income stock. Barclays was more upbeat than UBS which cut its rating to ‘Neutral’ in December amid concerns Brexit could hurt defence spending
BAE Systems PLC (LON:BA.) has been upgraded to ‘Equal Weight’ from ‘Underweight’ by Barclays as analysts said the firm was supported as “a defensive income investment” and increased their earnings per share (EPS) estimates for 2019 and 2020 by 4% and 11% respectively.
In a note, the bank said a “material” order book growth forecast for 2018, an improving cash profile from “longer-cycle phasing” in 2020, a 5% dividend yield, and an “undemanding value” with a 20% discount to US peers all backed the FTSE 100 defence firm as an income stock.
Analysts added that earnings growth and cash generation were “central for price momentum for BAE” and were supported by mid-single-digit year-on-year revenue growth with a 20-year long cycle visibility.
The bank also said execution discipline on the ramp-up of franchise programmes such as combat vehicles, F35 jets, classified projects, and UK Maritime “should drive EPS growth”, modelling a 9% EPS compound annual growth rate (CAGR) for the three years to the end of 2021. Analysts also upped their target price for BAE to 550p from 497p, saying they had “more bullish growth and margin expectations” for the group’s Electronic Systems segment and the Platforms & Services business in the US.
The outlook from Barclays was more upbeat than a previous take from Swiss Bank UBS in December when the stock was cut to ‘Neutral’ from ‘Buy’ amid concerns Brexit-related defence spending cuts in the UK could hit its performance. In lunchtime trading Tuesday, BAE shares were up 1.1% at 502.2p. (Source: proactiveinvestors.co.uk)
13 Jan 19. Serco in talks to become sub-contractor in Bupa deal with Australian Defence Force. Peel Hunt maintained a ‘hold’ rating and target price of 100p on Serco. Earlier this month Serco won its largest ever contract with the UK government. Serco Group PLC (LON:SRP) is in talks for a contract with Bupa Health Services as part of a deal to provide health services to the Australian Defence Force. Bupa signed a prime contract for health services to the Australian Defence Force on Monday and is now negotiating a deal with Serco to operate as a sub-contractor to provide the human resource managed service on associated defence bases. Earlier this month, Serco announced that it had been awarded contracts worth £1.9bn from the UK government to manage more than 5,000 properties occupied by asylum seekers.
Under the contracts, which mark Serco’s biggest ever by value to date, the outsourcer will be responsible for the upkeep of the homes located in the North West of England and the Midlands & East of England, for the next 10 years. The new Asylum Accommodation and Support Services Contracts (AASCs) are replacing the current COMPASS contracts, which were awarded back in 2012 but have proved costly for Serco.
Serco expects the AASC contracts to be materially positive to both profitability and cash flow by 2020. Peel Hunt raised its pre-tax profit estimate for the 2020 financial year to £101.7m from £92.7m previously reflect the deal.
“In 2020, the annual revenue is anticipated to be £150mln, which compares to revenue in 2018 on the predecessor COMPASS contracts of £70mln,” Peel Hunt said.
“The COMPASS contracts incurred a loss of £15m in 2018 (offset by utilisation of an onerous contract provision). In contrast, we anticipate that over its life the AASC contract underlying margin will average 7% (starting initially lower and increasing thereafter).”
Peel Hunt maintained a ‘hold’ rating and target price of 100p on the stock. In mid-morning trading, shares were changing hands at 114p, down 0.31%. (Source: proactiveinvestors.co.uk)
11 Jan 19. Embraer’s Board of Directors Ratifies Approval of the Deal with Boeing. Embraer’s Board of Directors ratified today its prior approval regarding the strategic partnership with Boeing. Yesterday, the Government of Brazil authorized the transaction that would position both companies to accelerate growth in global aerospace markets.
The closing of the transaction will be subject to shareholder and regulatory approvals and customary closing conditions. Assuming the approvals are received in a timely manner, the transaction is intended to close by the end of 2019. Embraer is a global company headquartered in Brazil with businesses in commercial and executive aviation, defense & security. The company designs, develops, manufactures and markets aircraft and systems, providing customer support and services. The company maintains industrial units, offices, service and parts distribution centers, among other activities, across the Americas, Africa, Asia and Europe. (Source: defense-aerospace.com/Embraer)
14 Jan 19. On the small-cap earnings beat. Investors should really not be concerned by the fall in first half revenue (from £4.8m to £3.7m) and the £600,000 cash loss reported by Sedgefield-based Kromek (KMK:26p), a radiation detection technology company focused on the medical, security and nuclear markets. Kromek moved to a state of the art facility medical grade facility in Pittsburgh last year that has the design, engineering and technological capabilities needed to produce commercial quantities of cadmium zinc telluride (CZT) crystals. The anticipated disruption meant that between £1.5m and £2m of sales were pushed into the second half of the financial year to end April 2019 as a result, hence the first half sales shortfall. They will be delivered.
More important is the fact that chief executive Dr Arnab Basu says that his company is bang on course to achieve the £15m of revenues the market is expecting for the full year, up from £11.9m in the previous year, buoyed by $18m (£14m) worth of orders won since the start of May 2018. In the past three years, Kromek has won $80m of contracts and analysts estimate Kromek’s current order book now exceeds $40m. I understand that of the £11.3m second half sales required to hit analysts’ full-year revenues estimates of £15m, about £5.1m have already been contracted for delivery, a further £4.1m are repeat orders, leaving only £2.1m of additional orders for Kromek to find, hence the directors confidence in hitting the full-year numbers.
Indeed, Dr Basu told me during our results call that Kromek has “a pipeline of near-term prospects in the process of being converted [into firm orders] that are a multiple of the $2m sales required [to hit the full-year outcome].” Moreover, forecast second half revenues of £11.3m should generate a cash profit of £2.25m. The company’s cash position will get a boost from the reversal of a £1.5m working capital build in the first half too. I would also flag up that Dr Basu says that about 72 per cent of analysts’ revenue estimates of £18.5m for the 2019/20 financial year are already in the bag, leaving just £5.2m of further orders to book in order to deliver the £3m of annual cash profit.
As I noted in my article earlier this month when the shares were priced around the current level (‘Kromek’s contract momentum building’, 3 January 2019), demand is ramping up for Kromek’s CZT technology across all three of its market segments. In the medical imaging industry, it’s being used by 11 OEM customers across single photon emission computed tomography (SPECT), BMD (to treat osteoporosis) and gamma probes (used for radio-guided surgery). For instance, the company’s CZT-SPECT medical imaging detectors are capable of diagnosing and monitoring conditions such as Parkinson’s disease and making early diagnosis of cancer.
In the nuclear sector, the company has been awarded a raft of contracts including one last month from an agency of the US Department of Defense to develop a proof-of-concept device for a vehicle-mounted biological-threat identifier. This builds on the success of Kromek’s work with the US authorities in nuclear-threat detection using its D3S ‘dirty bomb’ detectors, which are 10 times faster at detecting gamma and neutron radiation, and at a tenth of the cost of conventional detectors. Analysts at house broker Cenkos anticipate that a number of military and civilian pilots will be upgraded to full roll-outs by the US Homeland Security over the next 12 to 24 months. They have good reason to think this way. Also, it has never been disclosed to date, but I can reveal that Dr Basu informs me that Kromek’s dirty bomb detectors are currently being piloted in five locations outside the US. Expect a firm order to be placed with a value of around $5m to $15m for the first location within the next 12 months.
It’s also worth flagging up that Kromek has won a slew of orders in baggage screening including a $7.8m contract from an existing OEM customer to incorporate Kromek’s customised detector modules into the client’s baggage screening products. The point here is that new and tighter aviation regulations that are being introduced in Europe and the Rest of the World are now driving customers to adopt Kromek’s cutting edge technology in response to higher security screening standards.
Trading on a deep discount to analysts’ target prices of between 40p (Equity Development) and 45p (Cantor Fitzgerald), and with order momentum expected to ratchet up as adoption of Kromek’s CZT technology gains further traction, I maintain my positive stance, having first initiated coverage at 25p (‘Follow the smart money’, 27 February 2017). Buy. (Source: Investors Chronicle)
14 Jan 19. Kromek (AIM: KMK), a worldwide supplier of detection technology focusing on the medical, security screening and nuclear markets, has today announced its interim results for the six months ended 31 October 2018.
In the defence sector, the Group achieved the following highlights:
- Awarded two contracts in the US by DTRA, worth a total of $2.9m, to enhance the D3S platform, including the development of a ruggedised small form factor device for use in the military field
- D3S continued to be deployed and field-tested in major areas in the US by DARPA and by other public administrations across the globe
- Won several new customers in the nuclear sector, including the Spanish Army, and added new distributors in Europe and Asia
- Post period, received first contract for biological threat detection: $1.99m awarded by DARPA to develop, over a 12-month period, a proof-of-concept device for a vehicle-mounted biological-threat identifier
- Revenue was £3.7m (H1 2017/18: £4.8m)
- Gross margin increased to 67% (H1 2017/18: 63%)
- Operating costs reduced to £4.6m (H1 2017/18: £4.8m)
- Loss before tax was £2.1m (H1 2017/18: £1.8m loss)
- EBITDA** was £0.6m loss (H1 2017/18: £0.3m loss)
- Gross cash and cash equivalents at 31 October 2018 were £6.3m*** (30 April 2018: £9.5m; 31 October 2017: £15m)
*The Group has prepared the interim statements in accordance with the new accounting standards IFRS 15 ‘Revenue from Contracts with Customers’ and IFRS 16 ‘Leases’. For more information, please see note 1 to the consolidated financial statements below
**EBITDA defined as earnings before interest, taxation, depreciation, amortisation and share-based payments as detailed in the Financial Review below
***This excludes £1.3m (H1 2017/18: £1.3m) that has been invested into a money market account that is classified as an investment rather than cash and cash equivalents
- Unchanged outlook for FY 2018/19: on track to achieve revenue growth and EBITDA profit in line with market expectations
- Successfully relocated Kromek’s US manufacturing operations to new premises in Pittsburgh, which was purpose-built to be a high-volume manufacturing site for SPECT cameras and other medical imaging products
- Increased revenue visibility for the current and next financial year through new contracts and repeat orders won during the period
Three new patents were filed and four were granted during the period.
Dr Arnab Basu, CEO of Kromek, said: “The progress of 2017/18 was sustained into the current fiscal year as Kromek remained at the forefront in developing solutions to combat some of the greatest security and health challenges that are faced by society today. Our position has been strengthened by our new state-of-the-art facility in the US, which is designed to be a world-class manufacturing base for the production of medical imaging products including SPECT cameras. During the six months, we undertook a significant process of relocation, installation and revalidation of our manufacturing processes, and I’m delighted that the facility is now fully operational. Over the last three fiscal years we have won $80m of contracts, across all of our core sectors, demonstrating the successful conversion of our growing order pipeline. They also demonstrate the strong and long-lasting partnerships that we are continuing to build with our commercial and large government customers across the globe. As we continue to deliver on existing contracts as well as win new orders, our visibility of revenue for the next six to 24 months continues to increase, which includes visibility of approximately 86% of the forecast revenue for 2018/19. As a result, the Board is confident of delivering full year revenue growth and positive EBITDA, in line with market expectations.”
13 Jan 19. Israel drone maker Aeronautics gets $232m buyout offer. Israel’s state-owned Rafael Advanced Defense Systems and businessman Avihai Stolero have offered to buy unmanned aerial vehicle maker Aeronautics for 850m shekels ($232m). The news sent shares of Aeronautics up 37 percent in morning trade in Tel Aviv on Sunday. Aeronautics rejected a 430m shekel offer from Rafael and Stolero last August. Aeronautics, which had a market value of 507m shekels on Jan. 10, said the latest offer for all its shares would be done as a reverse merger executed through a company jointly owned by Rafael and Stolero. The company would become private and its shares delisted from the Tel Aviv Stock Exchange.
Aeronautics said it had agreed to hold talks with the potential buyers and committed to giving them exclusivity. Negotiations will take place until Feb. 15, during which time Rafael will conduct due diligence. Earlier this month, state-owned Israel Aerospace Industries [ISRAI.UL] said it was in early talks to invest in Aeronautics. In 2017, Aeronautics said the Defence Ministry had suspended the marketing and export license for one of the firm’s attack drones to a significant customer in a foreign country. The company denied any wrongdoing. Israeli media reported at the time that the ministry had opened an investigation into Aeronautics over whether during a product demonstration in Azerbaijan one of its drones was used to attack a military position in the neighboring country of Armenia, and if so, who was at fault. Aeronautics manufactures unmanned aerial vehicles for military surveillance and defense purposes, as well as for the commercial sector. (Source: Google/https://whbl.com)
11 Jan 19. Here are the four prizes Textron Systems is watching in 2019. Textron Systems is focusing on the U.S. Army this year, with its chief executive naming four unmanned and small arms programs with the service as the company’s “need to win” items in 2019.
Speaking to reporters Jan. 10, Textron President and CEO Lisa Atherton laid out the company’s top priorities:
- Squad Mobility Equipment Transport
With its recent acquisition of Howe & Howe Technologies, Textron finds itself a player in the Army’s Squad Mobility Equipment Transport competition.
The Army wants to buy a robotic equipment carrier that troops can load with their gear, and Howe & Howe’s tracked RS2-H1 robot is competing alongside three other companies for the contract.
“We believe that program will progress this year, and we look forward to moving that to low-rate production,” Atherton said.
The other competitors undergoing tests with the Army and Marine Corps are the Polaris MRZR X, a four-wheeled vehicle based on the Polaris MRZR currently in service with the Marines; the General Dynamics four-wheel drive Multi-Utility Tactical Transport; and the six-wheeled HDT Global Hunter WOLF, or Wheeled Offload Logistics Follower, Army Times reported last year.
Each company delivered prototypes to two Army infantry brigade combat teams and a Marine Corps unit for tests last year.
“They asked us to deliver eight vehicles and then just give them to the soldiers and let the soldiers do what they will with them and basically try to break them,” Atherton said.
The vehicles have now come back to Textron in good working condition, which Atherton said is a “testament to the robustness of that capability.”
After a year of tests, the Army will make a decision on the way forward with the program, which could involve a downselect to a single SMET provider, Army Times has reported.
- Robotic combat vehicle
As the Army looks to replace the Bradley Fighting Vehicle with what the service is calling the Next Generation Combat Vehicle, it is also hoping to develop an unmanned tank that can accompany it into battle as a robotic “wingman.”
Again, Textron’s acquisition of Howe & Howe gives the company an entry point into the competition, Atherton said.
“We believe that the Ripsaw is tailor-made for that,” she said, referring to the light unmanned tank developed by Howe & Howe. “So this year we will be focused on responding to the [requests for proposals] that come out for the prototypes.”
Ripsaw’s appearance on the show “Jay Leno’s Garage” attracted Atherton’s attention to Howe & Howe and laid the foundation for the company’s eventual acquisition. The robotic tank has been featured in numerous TV and movie spots, including the film “Mad Max: Fury Road.” The Army previously tested it at Picatinny Arsenal in New Jersey.
Atherton said Textron will make investments to improve the survivability of Ripsaw, as well as add “other innovations.”
Brig. Gen. David Lesperance, who is leading the NGCV Cross-Functional Team, said in March that both NGCV and robot combat vehicle prototypes will be ready for soldier evaluations by 2020, with follow-on prototypes ready by 2022 and 2024.
- Future tactical unmanned aerial system
As the Army looks to replace its RQ-7 Shadow drones, it’s testing a number of small, nondevelopmental unmanned aerial systems with the hopes of buying something off the shelf.
As part of that effort, Textron was chosen to demonstrate Aerosonde HQ at Dugway Proving Ground, Utah, last month, Atherton said. Aerosonde HQ is a version of Textron’s small Aerosonde UAS and includes a kit that allows it to take off and land vertically.
“Our team widely exceeded the threshold requirements,” she said. “So we’re very proud of what we were able to do: very rapidly integrate those techniques and procedures and technologies into the Aerosonde to be able to provide that to the Army for the future tactical UAS.”
- Next Generation Squad Weapons
Textron also believes it has strong offerings for the Army’s Next Generation Squad Weapons effort, an umbrella program to replace soldiers’ small arms, Atherton said.
Reducing the weight of small arms is a major goal of the program, and Textron previously developed case-telescoped weapons it claims are lighter in weight and more lethal than current weaponry.
“We believe we are the leaders in the case-telescoped prototypes for the Army’s next-generation squad weapon with our lightweight small arms technologies,” Atherton said.
The company showcased a 5.56mm light machine gun variant and a 6.5mm caseless service rifle variant at the Association of the U.S. Army’s annual meeting in 2017, Army Times reported.
The service has awarded contracts to Textron; FN America, LLC; General Dynamics; PCP Tactical; and Sig Sauer to build prototypes of a Next Generation Squad Automatic Rifle, or NGSAR. The prototypes are due to be delivered this year. That weapon would replace the M249 Squad Automatic Weapon, which fires 5.56mm rounds.
The program also seeks to find a replacement for the M4, which it calls the Next Generation Squad Weapon Rifle, or NGSW-Rifle. Both NGSW-Rifle and NGSAR will fire 6.8mm rounds. (Source: Defense News)
11 Jan 19. SAIC and Engility Announce Approval of Merger by Stockholders of Both Companies. Science Applications International Corporation (NYSE: SAIC) (“SAIC”) and Engility Holdings, Inc (NYSE: EGL) (“Engility”) today announced that stockholders of each SAIC and Engility overwhelmingly approved their respective proposals related to the proposed merger of SAIC and Engility at their respective special meetings of stockholders earlier today.
More than 98% of the shares voting at the SAIC special meeting of stockholders voted in favor of the proposal to issue shares of SAIC common stock to Engility stockholders in connection with the merger, and more than 99% of the shares voting at the Engility special meeting of stockholders voted in favor of the proposal to approve and adopt the merger agreement.
Upon the consummation of the merger, Engility stockholders will have the right to receive 0.450 shares of SAIC common stock for each share of Engility common stock, with cash paid in lieu of fractional shares.
SAIC and Engility expect the closing of the transaction to occur promptly, subject to the satisfaction of all conditions. (Source: BUSINESS WIRE)
11 Jan 19. Nordic ammunition group Nammo acquires majority ownership in MAC. Nordic ammunition group Nammo has acquired a majority ownership stake in US company MAC, a manufacturer of lightweight polymer cartridge cases for small and medium calibre ammunition. Financial terms of the deal have not been disclosed. Nammo noted that it has taken over the ownership position in MAC after the US Government reviewed and approved the transaction. MAC will trade under the Nammo Small and Medium Caliber Ammunition division and will play a key role in Nammo’s US growth plan.
Nammo Small and Medium Caliber Ammunition executive vice-president Reijo Bragberg said: “Through this decision, we are now establishing Nammo and MAC as frontrunners in development of lightweight technologies, which are of great importance for our defence customers.”
MAC president Nick Malkovich added: “We are extremely satisfied to have Nammo become a majority owner. The experience from our first year working together has been very positive, and we look forward to strengthening our cooperation going forward.”
Based in Bay St Louis, Mississippi, US, MAC is involved in the development of technologies that support troops with lightweight ammunition solutions. MAC’s lightweight, polymer-based solutions for military ammunition products are said to improve range and endurance for vehicles and aircraft while reducing soldier fatigue. This technology is expected to build Nammo’s capabilities and strengthen the group’s position in the US and international ammunition markets. Norway-based Nammo is a major supplier of specialty ammunition for military and commercial users. (Source: army-technology.com)
10 Jan 19. Textron finalizes acquisition of robotics company. Textron’s acquisition of robotics firm Howe & Howe Technologies stemmed from a late night channel surfing session, where a fortuitous viewing of “Jay Leno’s Garage” turned into a big business deal.
As its CEO Lisa Atherton watched the show at home with her husband, Howe & Howe’s light tank drone wheeled across the screen. Textron had recently identified a gap in unmanned land vehicles, and this seemed to fit exactly the niche that the company was looking to fill. “I saw this tracked vehicle kind of flying through the woods and up and over the berms, and so I went and did a little research,” Atherton told reporters on Jan. 10.
Textron declared in October that it intended to purchase the Waterboro, Maine-based company. On Dec. 17, the deal was finalized, the company announced Thursday morning. The businesses have not disclosed the price or terms of the sale.
Textron executives believe Howe & Howe, which specializes in innovative robotic ground vehicles, is a natural fit for their company, which is known for building unmanned systems — predominantly drones like the RQ-9 Shadow and maritime assets like the common unmanned surface vehicle that can deploy from a littoral combat ship to find mines.
Meanwhile, Textron brings with it the ability to manufacture unmanned systems en masse and to support them in the field. Howe & Howe’s senior vice president, Michael Howe, said his company’s inventiveness, coupled with Textron’s experience selling unmanned systems to the government, “makes for an extremely formidable combination.”
Atherton said she is looking forward to getting Howe & Howe the investment dollars necessary to start work on new products and make existing ones more robust.
“Mike and Geoff [Howe, the company’s other founder] both have a ton of great ideas,” she said. “They have ideas that they’ve sketched out in their books forever that they just haven’t had the opportunity to do the investment for.”
Several of Howe & Howe’s robotic land vehicles have been evaluated by the U.S. Army. Its Ripsaw vehicle — the small unmanned tank seen on “Jay Leno’s Garage” — has undergone testing at Picatinny Arsenal in New Jersey. But when sequestration slowed down funding of tests, the Howe brothers looked for other venues to promote it, landing the product a role in the 2015 classic “Mad Max: Fury Road.”
“That speaks to their ingenuity, their ability to survive through sequestration as a small company,” Atherton said.
Howe & Howe’s RS2-H1 robot, invented to carry soldiers’ gear, is competing against three other unmanned land vehicles for the Squad Multipurpose Equipment Transport program contract. Two Army infantry brigade combat teams and an undisclosed Marine unit are currently assessing the four contenders ahead of a downselect, Army Times reported last year. Atherton named that opportunity as one of the four big programs she’s hoping Textron can win in 2019. (Source: Defense News Early Bird/C4ISR & Networks)