19 Sep 19. Five Genius NY Startups Raise $10m + in Follow-on Funding. Five startups in the Genius NY accelerator have raised more than $10m in additional private investment. They include AutoModality, Civdrone, Fotokite, OmniMesh, and TruWeather Solutions, according to a Thursday news release from CenterState CEO and Genius NY.
Genius NY is CenterState CEO’s in-residence business accelerator program at the Tech Garden in Syracuse. Genius NY stands for Growing ENtrepreneurs & Innovators in UpState New York.
This follow-on-funding “validates” the investments the Genius NY program has made in unmanned aircraft systems (UAS) technologies and startups over the last three years, CenterState CEO contends.
Genius NY is supported by Central New York Rising, which “advances the region’s collective strategy to create ecosystem of resources for companies in the UAS industry.”
“It’s exciting to see these early-stage companies start to receive follow-on-funding from names like Credit Suisse and ff Venture Capital. Our goal in the accelerator is to get them started with seed investment, help work through their business plans and bring them to the commercial market,” Jon Parry, director of Genius NY, said in the release. “Our finalists are given all the resources needed to continue to scale after the yearlong accelerator, including three investor demo days for opportunities to raise follow-on funding.”
These investments build on those made to the companies during the Genius NY program. Two of the firms, AutoModality and Fotokite, were awarded the program’s $1 million grand-prize investment. Since 2017, Genius NY has invested in 17 startups and awarded over $9 million.
All of the companies invested in by Genius NY remain operational, and “continue to scale and hire,” the release stated.
AutoModality — a 2017 Genius NY participant — has raised $3.8 million from LiteCap and Autonomous Control Systems Laboratory (ACSL) this past month. AutoModality specializes in “advanced” UAS flight-control software for use in infrastructure inspection, including bridges, culverts, rolling-stock and cell towers. It creates fully-autonomous mobile systems that “enhance the effectiveness, efficiency, and safety of inspections and also reduces future maintenance,” per the release.
Civdrone — a 2019 Genius NY participant, $500,000 prize winner — has raised $500,000 from New York–based firm ff Venture Capital (ffVC). Civdrone develops a device that can be mounted on commercially available drones for land surveying and marking on construction sites. Civdrone’s technology uses a built-in, real-time kinematic (RTK) GPS system and a mechanism that inserts stakes into the soil for marking.
Fotokite — a 2018 Genius NY participant — has raised its funding from Credit Suisse Entrepreneur Capital Ltd, SONY Corporation, Qualcomm Ventures, and private investors. It also recently spent time completing a European Commission Horizon 2020 SME Phase 1 Project. Fotokite is focused on improving the safety and speed of public safety team operations, such as fire brigades, where it provides aerial situational awareness information to firefighters and first responders to help manage complex, safety-critical situations. Fotokite tethered aerial systems are self-flying, allowing public safety teams to “spend less resources on piloting drones and more time on responding to their mission,” per the release.
TruWeather Solutions — a 2018 Genius NY participant, $400,000 prize winner — has raised $450,000 from Kluz Ventures, through its The Flying Object and The Next Impact funds. TruWeather has built a service to “improve” the precision, accuracy and communication of weather intelligence for UAS. This investment will “fuel the enhancement and market penetration” of its first product, TruFliteUAS. That is a micro weather data and business-focused analytic cloud service for the commercial UAS and drone industry.
OmniMesh — a 2017 Genius NY participant, $400,000 prize winner — has raised $1 million from a simple agreement for future equity, or SAFE agreement, per the release. OmniMesh’s patented technology enables service providers and content owners to deliver content to subscribers in a “cost-effective, scalable and secure manner.” OmniMesh’s platform enables competitive local exchange carriers (CLECs), cable companies, Telcos, mobile providers, production houses, content creators, and other entities to “satisfy the growing demand” for content while “substantially reducing” the capital investment and operating costs associated with legacy infrastructure. (Source: UAS VISION/Business Journal New York)
18 Sep 19. AEC outlines growth, localisation plans. Saudi Arabia’s Advanced Electronics Company (AEC) is expecting significant growth following its forthcoming acquisition by Saudi Arabian Military Industries (SAMI), the company’s President and CEO Abdulaziz Al Duailej has told Jane’s.
“We are expecting that it will quadruple our topline revenues over the next ten years,” Al Duailej said, with the move into SAMI expected to open up new horizons for the firm. An initial agreement for the acquisition of AEC by SAMI was announced in June. Following the company’s acquisition, AEC will represent the Defence Electronics arm of the business, but will also operate across the defence and aerospace and other lines of business such as electronics, C4ISR, electronic warfare, and avionics. (Source: IHS Jane’s)
19 Sep 19. SCISYS Group PLC (“SCISYS” AIM SSY; ESM: SCC), the supplier of bespoke software systems, IT-based solutions and support services to the space, media & broadcast, government, defence and commerce sectors, is pleased to announce its interim results for the half year to 30 June 2019.
Financial and Operational Highlights:
- Cash offer of 254.15p per share from CGI approved by shareholders in August
- Revenues up 2% to £29.4m (2018: £28.7m)
- Adjusted operating profit at £1.2m (2018: £2.5m)
- Order book increased to £102.5m (2018: £92.2m)
- Net debt reduced to £3.0m (2018: net debt £3.3m)
- Adjusted basic earnings per share 2.2p (2018: 6.1p)
- Enterprise Solutions and Defence (ESD) division delivered record first half results, building on previous contract extensions and wins
- Space division in Germany secured further Galileo ground segment orders of €9.7m
- Media Solutions division registered a strategic win with a major European broadcaster for newsroom software
Mike Love, Chairman of SCISYS, commenting on the results, said: “We are pleased with our continued solid operational performance and my thanks goes out to the divisions and staff for achieving these results. Understandably, the takeover offer from CGI that was announced on 14 June significantly occupied SCISYS senior management and resulted in some exceptional expenditure. Notwithstanding this, we have delivered a creditable set of results for the period. Our shareholders voted to approve the CGI takeover on 7 August which we expect to complete in the second half of 2019; we are currently working with CGI to obtain the necessary regulatory approvals for the bid to proceed to the final Court approval stage. The business continues to perform in line with board expectations though, as already highlighted and in common with previous years, we expect our 2019 results to be more weighted towards the second half of the financial year.”
19 Sep 19. SAS launches investor roadshow to raise $15m for first commercial satellites. Australian space company Sky and Space Global has embarked on an institutional and broker roadshow through Asia and Australia to pitch for the $15m it needs to further its plans.
That will take the form of a share placement to fund the construction, testing and launch of the company’s first eight commercial 6U nanosatellites. The roadshow leads into the general meeting of shareholders to be held on 27 September. Sky and Space Global’s (SAS) presentation includes details of the capital raising to be approved by shareholders and proposed new directors following successful completion of the capital raising as part of its Australian Securities Exchange (ASX) re-quotation requirements.
“SAS is looking forward to completing the corporate actions as set out and moving quickly ahead with its business plan to launch its commercial services in Q4 2020,” it said.
SAS, based in Perth, is well advanced in plans for what it calls the Pearls constellation of as many as 200 nanosatellites in equatorial orbit, providing low-cost communications, data and internet services for markets in Africa, South America and Asia.
The company is proposing an additional satellite constellation, allowing full global coverage, including Australia, Russia, China, South Africa, Argentina and Canada. The company has more than 50 agreements in place for use of its services once they’re in place.
In 2017, SAS Global launched three prototype satellites on an Indian rocket to test its technology.
SAS has experienced its fair share of problems, particularly attaining the cash needed to advance its operations.
The presentation says that it’s offering cost-efficient and reliable remote communication services based on nanosatellites, dedicated to rural connectivity, internet of things and asset tracking.
SAS incorporated in the UK in 2015 and listed on the ASX in May 2016.
“SAS is the first company to plan, build and operate a telecommunication commercial network over nanosatellite technology. It is an innovative and disruptive New-Space company with a strong B2B mode,” it said.
“Our offering is to provide cost-effective and reliable remote communication services and connect the unconnected. We are an experienced and capable team comprised of engineers, program managers, marketing/sales and software developers.”
SAS said proceeds from the share placement would be used for manufacture of satellites by Danish firm GomSpace, facilitating their launch, manufacturing ground terminals, plus other operational costs and expenses of the placement.
The company says the market opportunity is in remote communication services, which are currently lacking in coverage, reliability, cost efficiency and scalability.
It says cellular connectivity is not globally available and satellites solutions are expensive, complex and non-dedicated. Its solution provides global reliable connectivity via nanosatellites, enabling scalability and opening new market opportunities.
It says it expects to see its first revenues in fourth quarter 2020, following launch of first commercial satellites and the rollout of ground terminals. (Source: Space Connect)
18 Sep 19. Orolia Defense & Security Announces Completed Acquisition of Talen-X. Talen-X has joined Orolia Defense & Security to expand its capabilities and resources, enabling the development of more advanced Position, Navigation, and Timing (PNT) solutions and to offer more robust customer support. Orolia Defense & Security has completed the acquisition of Talen-X, a U.S. company specializing in advanced Global Navigation Simulation System (GNSS) solutions and Interference, Detection and Mitigation (IDM) technologies.
“Orolia Defense & Security is excited to bring on Talen-X as they offer a complementary portfolio of solutions and bring many years of advanced PNT experience to the team. We look forward to continuing their growth by providing additional resources and capabilities, while ensuring the growth and success of their current customers,” said Hironori Sasaki, President of Orolia Defense & Security.
In early 2019, Orolia Defense & Security spun off as a separate entity from its parent company Orolia, with the mission of providing Resilient PNT solutions and custom engineering services to U.S. Government agencies, U.S. Defense organizations, and their contractors.
Orolia Defense & Security operates as a proxy-regulated company, Free of Foreign Ownership, Control, or Influence (FOCI). As such, Orolia Defense & Security is approved to work on the full spectrum of U.S. Government classified and unclassified projects and is positioned to support strategic partnerships in the development of key PNT technologies for the defense market.
“Our culture of innovation, together with our demonstrated testing capabilities, will complement Orolia’s technology expertise and significantly enhance the reliability, performance and safety of military operations,” said Tim Erbes, Orolia Defense & Security’s Director of Engineering. The acquisition also enables Talen-X’s existing resources, operations and capabilities to be scaled and accelerated to better support the warfighter. At the Modern Day Marine and Association of the U.S. Army (AUSA) exhibitions, Orolia Defense & Security is showcasing its latest technologies such as the BroadSim Wavefront GNSS simulator, ThreatBlocker jamming/spoofing detection and protection device and BroadShield threat detection software. Authorized for use with U.S. military signals such as GPS L1/L2, P, Y, and M-Code, Orolia’s Simulation and IDM solutions serve the most unique and challenging program requirements.
18 Sep 19. UK government intervenes in Cobham’s £4bn takeover. The FT reported today that the British government has intervened in the £4bn takeover of Cobham, the aerospace and defence group, on national security grounds.
Andrea Leadsom, business secretary, said after considering advice from the defence secretary and others from across government, she had decided to issue a so-called “intervention notice on the grounds of national security”. “As part of the statutory process, the Competition and Markets Authority will now investigate and carry out a review on the national security implications of the transaction,” she said. The government’s goals, she added, are “to support private sector innovation whilst safeguarding the public interest”. The CMA has been asked to report to her by 29 October.
The move by the government comes just days after shareholders in the FTSE 250 group on Monday overwhelmingly backed the all-cash offer from private equity firm Advent International, with more than 93 per cent voting in favour on a turnout of 78.5 per cent. It comes after a campaign by the founding family of Cobham, which owns 1.5 per cent of the company, which said the takeover was against the “national interest”. Nadine Cobham, whose late husband Michael Cobham ran the company and was the son of the founder Alan Cobham, wrote to the government asking ministers to intercede. Cobham’s pioneering air-to-air refuelling technology is used on all western fast jets but it is also a key supplier of components for the F-35 fighter and to the US military’s electronic warfare and radar capability. Recommended Cobham PLC Cobham snapped up by US buyout group Advent in £4bn deal Concerns had also been raised by a number of MPs, as well as former executives of the company, at an apparent lack of scrutiny from the government.
UK government interventions on national security grounds are rare. New rules for takeovers were introduced in 2018 in response to concerns that sensitive technology was being snapped up by foreign buyers, particularly Chinese companies. More sweeping proposals put forward in a national security and investment white paper published last summer were widely criticised for being too broad and unpredictable. Advent said it is “committed to being a responsible steward of Cobham, encouraging its future growth and success”. It said it will “continue to engage constructively and cooperatively with the UK Government in this part of their review.” Cobham was unavailable for comment on Wednesday morning. Its board, led by chief executive David Lockwood, previously said it saw no grounds for national security concerns. Advent has been in talks with the government about providing legally-binding commitments on investing in research and development in the UK after the takeover.
BATTLESPACE Comment: This move mirrors the move made over GKN and Melrose and may mean that Advent has to give undertakings to keep the MoD business in the UK for at least 5 years. We would expect the takeover to be allowed with certain undertakings.
17 Sep 19. Big insurance claims on satellite losses end downward trend in insurance premiums. It has not been a good year for the space insurance business, and that’s causing some insurers to up their premiums and others to even ponder whether they should be doing launch insurance at all. In July, the failure of a Vega rocket and the loss of its Falcon Eye-1 payload for the United Arab Emirates produced the largest ever single insurance claims for US$415m. In January, the failure of the Maxar Technologies WorldView-4 imaging satellite led to a claim for US$183m, which is set to be paid in full.
Dominique Rora, senior space underwriter at AXA XL, told the Euroconsult World Satellite Business Week in Paris that the underlying problem wasn’t the big claims but really declining premiums that produced back-to-back losses for the industry this year and last.
“In recent months, there have been a number of claims and the amount is quite high. It is high but not out of the norm,” Rora said, as reported in spacenews.com.
“What has been of particular importance over the past few years is the decreasing trend in premium.”
The recent big space insurance claims have apparently put an end to declining premiums. Rora said 2003 insurance rates for the first year of a satellite’s operations exceeded 20 per cent, but last year, similar insurance coverage fell to 5 per cent, driven by increasing capacity in the space insurance market.
“In the first part of 2019, there was a flattening of rates, and since the events of this summer, we have seen an increase. We don’t know yet where the rates will stabilise,” he said.
Some of that uncertainty apparently stems from potential departure of some players.
At the end of July, the world’s second-largest reinsurance company, Swiss Re, announced it had ceased insuring satellites and launches because of bad results and unsustainable premium rates.
Others may follow, Rora told the conference.
“There is a number of insurance players that are reviewing their position or withdrawing from this space insurance market,” he said.
“There is a general market consensus that the premium volume that we’re seeing today is about half of what it should be.”
Total premiums have been running US$450m a year, compared with US$700m to US$1bn earlier in the decade. (Source: Space Connect)
16 Sep 19. U.S. private equity firm Advent International won its battle to buy Britain’s Cobham for $5bn on Monday, taking advantage of the weak pound to pounce on the defence and aerospace group.
Chairman Jamie Pike told a shareholder meeting the management had “pushed as hard as they could push” and engaged in some “arm wrestling” before finally settling on a price that marked a 50% premium to the three-month average share price before the deal was announced.
In the latest of a series of buyouts in Europe as private equity firms seek new targets for their bumper cash balances, the deal was struck at 165 pence per share. The stock was trading at 161 pence in mid-morning on Monday.
Cobham, which employs 10,000 people to make its pioneering air-to-air refuelling system and communications for military vehicles, has a storied history but has faced difficulties in recent years.
Launched in the 1930s, Cobham equipment came to the fore ahead of World War Two and in the 1982 Falklands conflict. Its technology is now used in aircraft such as the F-35 Joint Strike Fighter and Eurofighter Typhoon as well as advanced naval vessels, satellites and military vehicles.
However, the company is still recovering from a string of profit warnings in 2016 and 2017, which forced it to raise cash from shareholders and prompted Chief Executive David Lockwood to embarked on a turnaround strategy more than two years ago to improve its financial and operating performance.
Final results from Monday’s shareholder vote are not yet in, but the deal crossed the line with the 93% approval from proxy votes.
Advent has a track record in buying British technology, having snapped up electronics company Laird for $1.65bn last year. Cobham’s Lockwood was Laird’s chief executive between 2012 and 2016.
Lockwood told Monday’s meeting that it is highly unlikely he will stay with the company but has yet to discuss the matter with Advent. Media reports have said previously that the Cobham family had opposed the deal and made this clear to its biggest investors. ($1 = 0.8042 pounds) (Source: Google/Yahoo!)
19 Sep 19. Ricardo continues to suffer weak auto market. Ricardo (RCDO) encountered severe difficulties in the European and US automotive markets over its full year, as the engineering group saw its overall order intake slide to £386m, down from £413m last year. Its current exposure to the UK automotive market is low, according to chief executive Dave Shemmans, who suggested that we may have entered the bottom of the automotive cycle. Ricardo had no orders from Jaguar Land Rover this year. “From that perspective, it can’t get any worse,” he said.
Ricardo fared better in its performance products and energy & environment divisions. It made an acquisition in the latter segment in Australia in July, sealing another deal down under in its rail outfit in May. These agreements pushed Ricardo’s net debt up significantly. But, far from seeking to immediately reduce this figure, chief financial officer Ian Gibson said that the business had an eye on more acquisitions, as it considers building out its rail and energy & environment presence, along with its automotive capability, with “software-type businesses within the automotive space”, he said. “We don’t have any rail presence in the US, and we don’t have any environmental presence in the US,” he added.
Peel Hunt forecasts full-year 2020 pre-tax profits of £42.3m and earnings per share of 61.3p, rising to £44.5m and 64.6p in 2021.
Ricardo’s shares dropped by as much as 9 per cent in early trading following the release of its results, which is a surprise given the company’s clear exposure to a dire automotive market. But it remains a decent quality company with good capital returns and operating margins, and, with the rest of the business showing growth, we retain our rating. Buy. Last IC View: Buy, 604p, 28 Feb 2019. (Source: Investors Chronicle)