Sponsored by TCI International Inc.
01 Apr 21. Anduril buys tube-launched drone developer Area-I. Anduril Industries, a venture-backed defense technology company, has acquired Georgia-based, air-launched effects company Area-I, the company announced April 1.
“The acquisition expands Anduril’s portfolio of unmanned aerial systems, creates new opportunities for its software-defined capabilities such as mission autonomy and intelligent teaming and significantly accelerates the company’s strategic growth,” Anduril’s statement says.
The company will operate as a wholly owned subsidiary under the Area-I brand, according to the Anduril statement.
California-based Anduril specializes in advancing technology like artificial intelligence, computer vision, sensor fusion, optics and automation to “radically transform U.S. defense capabilities and solve complex national security challenges,” according to the company.
Anduril was founded by Oculus founder Palmer Luckey. Co-founders are CEO Brian Schimpf, COO Matt Grimm, Joe Chen and Founders Fund partner Trae Stephens. Peter Thiel ― who leads Founders Fund with Silicon Valley investors Ken Howery and Brian Singerman ― founded data analytics company Palantir, which has since achieved a foothold in the defense sector.
Area-I is known in the Army aviation development community for supplying its Agile-Launched, Tactically-Integrated, Unmanned System (ALTIUS) platform to several major Army Air-Launched Effects (ALE) demonstrations and experiments. Those experiments have helped define service requirements for future capabilities that will be found aboard Future Vertical Lift aircraft.
The Army awarded Area-I a contract last year to mature air vehicle technologies for the service’s future ALE portfolio. Area-I’s other customers include the U.S. Air Force, U.S. Navy, U.S. Special Operations Command and NASA.
Area-I was founded in 2009 by CEO Nick Alley, who once told an audience at Austin Startup Week that he had to borrow $10,000 from his parents to cover employee salaries while he waited for government funding to come through. He faced a common problem for a small business trying to break into the defense industry: ALTIUS had no commercial applications, so the company was solely reliant on obtaining government funding, which doesn’t always come quickly enough to continue operations.
Alley had been asked to speak as a small business owner who had seen success winning and executing government contracts. “The practical advice that I gave was that even with this multimillion dollar company that is well-entrenched with the Department of Defense, we still haven’t made it,” Alley told Defense News in a March 31 interview.
While Alley felt his business was successful, he knew he needed further investment to realize the potential of the company’s technology and didn’t want to sell the company he had built to a big prime contractor or a private-equity firm. That’s when he met Anduril’s CEO Brian Schimpf, as Anduril was weighing opportunities in the unmanned world.
Anduril has already applied its technology like its Lattice software platform for base protection, automated surveillance, counter-drone systems, counter-cruise missile or cruise missile tracking, all the way to intelligence, surveillance and reconnaissance systems.
The company wanted to create new warfighting capabilities by marrying its advanced autonomy, artificial intelligence, and sensor-fusion capabilities with lower-cost hardware, Schimpf told Defense News in the same interview.
Whereas a Reaper unmanned aircraft system, for instance, takes 15 people to operate, Schimpf says future battle spaces will be characterized by “more assets, more intelligence, more awareness of what’s going on and the only way that’s going to work is if we can automate a lot of the very mechanical, human driven processes.”
To that end, Anduril began looking at how low-cost assets could be made smarter and more independent to free up manpower for other operational elements ― and it was excited by the potential applications of tube-launched, air-launched, expendable drones.
“The ability to put a flying sensor on any one of these platforms, be it an air vehicle, like a C-130 or a Black Hawk, be it a ground vehicle, ground-launching these things, doing it off of a surface vessel … the ability to take these kind of high-value, manned or exquisite platforms and extend their reach, particularly in contested areas, being able to work into an area where there’s a surface-to-air missile threat, some sort of threat activity like GPS jamming or communications jamming, being able to push that envelope where you wouldn’t want to send those exquisite, high-risk things becomes a no brainer.”
Schimpf said he was “blown away” by Area-I’s ALTIUS, with its “incredible” endurance and ability to integrate sensors and payloads. “They have absolutely the best in capability for having a drone that can launch off any platform,” he said.
The companies were a fit, Schimpf said, both in terms of how they function on a cultural level and how they envision bringing technology to warfighters in the same way.
“With us and with them as well, the idea has really been about how am I going to push forward the vision of what’s possible,” he said, “not just responding to requirements that are dropped, but really trying to respond to ‘Hey, what do we think is possible if we push this technology to the limit, how does it change warfighting?’”
From here, Anduril and Area-I see huge potential in the ability to deploy dozens of these systems from a single platform, controlled by just one operator, to search for targets or disrupt an adversary’s radar, for example.
“That becomes a very big shift in terms of how you make this a real kind of warfighting capability where it’s not just as simple as a camera flying remotely,” Schimpf said, adding: “The ultimate goal here is these things can accomplish much more complex missions.”
Area-I had already begun working on a number of technologies around multi-asset planning and coordination of systems.
Now Anduril will accelerate these efforts by investing in the technology, bringing in its own advanced software technology and sensor processing and fusion capabilities and providing other resources that will help fuel and accelerate growth, Schimpf said. (Source: Defense News)
01 Apr 21. Elbit Systems Ltd. (NASDAQ:ESLT and TASE: ESLT) (“Elbit Systems”) announced today the acquisition of BAE Systems Rokar International Ltd. (“Rokar”) from BAE Systems, Inc., the U.S. headquartered subsidiary of BAE Systems plc (LON: BA) for approximately $31m net of any cash in Rokar. Located in Jerusalem, Israel, Rokar specializes in the development, manufacture, integration, and support of high-end GPS receivers and guidance systems for advanced defense applications.
Bezhalel (Butzi) Machlis, Elbit Systems President & CEO, commented: “There is increasing demand for our networked precision fire solutions. Rokar’s technologies are integrated in our solutions and the acquisition will further enhance our capabilities in this growing area of activity.”
31 Mar 21. Cubic accepts sweetened buyout offer from Veritas Capital, Elliott. Cubic Corp said on Wednesday it had agreed to a sweetened buyout offer from private equity firm Veritas Capital and U.S. hedge fund Elliott Management that values the defense electronics maker at about $2.38bn. The move ends a bidding war for Cubic, which had also attracted a $2.4bn, or $76 per share, approach from Singapore’s ST Engineering last month. The latest offer from Veritas and billionaire Paul Singer’s Elliot values the San Diego-based company at $75 per share and is at a discount of 2% to its shares’ last close. Veritas and Elliot had agreed to take Cubic private in February by paying $70 per share before ST Engineering made a bid. Cubic said in a statement on Wednesday that it had ceased further engagement with the Singapore-based company. (Source: Reuters)
31 Mar 21. J.F. Lehman & Company Announces Investment in Trillium Engineering, LLC. J.F. Lehman & Company (“JFLCO”), a leading middle-market private equity firm focused exclusively on the aerospace, defense, maritime, government and environmental sectors, is pleased to announce that an investment affiliate has made a substantial investment in Trillium Engineering, LLC (“Trillium” or the “Company”).
JFLCO is partnering with Trillium’s founders and employees, who will remain material shareholders in the business and continue to lead Trillium as the Company pursues its next phase of its growth. Founded in 2013 and headquartered in Hood River, Oregon, Trillium is a leading designer and manufacturer of highly engineered camera gimbals for unmanned aerial systems (“UAS”) performing mission-critical intelligence, surveillance and reconnaissance missions. Serving as the mission-enabling “eyes” of UAS, the Company’s products provide best-in-class stability and imagery for real-time geospatial and geolocation applications in the visible and infrared spectrums. Trillium serves a diversified array of domestic and international defense and government UAS OEMs, integrators and end-users.
“We believe Trillium is rapidly establishing itself as the leading provider of camera gimbal technology in the growing UAS marketplace. The disciplined leadership by the Company’s founders has fostered both an environment of technical and commercial excellence and the commitment of talented employees who have established a culture of innovation and premium levels of customer service. We are excited to partner with Rob Gilchrist, Jeff Fisher, Gail Dagan and the rest of Trillium’s talented team.” said Steve Brooks, Partner with JFLCO. Mike Friedman, a Managing Director with JFLCO added, “We believe Trillium’s market-leading product portfolio, blue-chip customer base and established content on leading UAS platforms leaves the business well positioned to benefit from the significant expansion anticipated in the unmanned market. We are thrilled to support the Company on its continued path to growth.”
Rob Gilchrist, President of Trillium, commented, “J.F. Lehman & Company represents strong alignment with our goal to partner with a firm possessing the experience and track record to support our continued technical and commercial evolution. We look forward to leveraging the firm’s unique sector expertise as we continue to provide our customers with innovative solutions that meet and exceed their ever-evolving mission requirements.”
Jones Day served as lead legal counsel for JFLCO. Baker Hostetler provided government contracts, defense security and international trade advice to JFLCO. Houlihan Lokey served as financial advisor to Trillium and its members in connection with the transaction. Sheppard Mullin provided legal counsel to Trillium and its members.
31 Mar 21. MBDA: Resilience and innovation for growth. MBDA showed strong resilience in 2020 despite the global pandemic. Revenues were at €3.6bn in 2020, with a 50:50 split across domestic and export customers. Order intake during 2020 was €3.3bn, with MBDA’s order backlog now standing at €16.6bn. Éric Béranger, CEO of MBDA, said: “The 2020 results represent a remarkable achievement by all MBDA colleagues who have shown commitment, team spirit and innovation in ensuring the company continued to deliver for its customers. I also want to thank our customers who have continued to trust us during this difficult year. These results pave the way for future growth. MBDA is at the heart of the sovereignty of our home nations and their allies, and we will continue to offer them the most advanced solutions that protect national security and enable strategic independence”.
2020 was another year of strong recruitment that saw MBDA hiring 1,100 new employees across Europe in 2020, with plans to hire another 1,200 people this year.
Major new business won during 2020 included; a production order for the SPEAR missile for the Royal Air Force and an upgrade for the Brimstone 3 missile; Aster mid-life refurbishment for France and the commissioning of the development of the new MHT combat missile for the Tiger helicopter; Italy winning a contract for the new Teseo MK2/E anti-ship missile; and the contract (with Rheinmetall as co-contractor) for a new high-energy laser demonstrator for German Navy. Major export orders included a naval weapons package for a foreign undisclosed customer and a naval weapons package for Senegal.
Armed forces are facing a rapidly evolving threat environment. The risk of high-intensity conflicts increases while asymmetric engagements remain. Emerging threats are faster, better protected, smarter, and more collaborative in all domains. Countering those threats is becoming more complex and will require the implementation of a wide range of interconnected effectors acting in concert with tactical agility to create the force multiplier needed to achieve the military objectives sought.
To answer the future needs of its customers’ armed forces, MBDA is extensively investing in new types of innovative effects (Directed Energy Weapons, Counter-measures, etc.), technologies (Artificial Intelligence, target identification, hypersonic, etc.), and associated techniques (combination of effects, collaboration, swarming, packs, fast targeting, complex mission planning, navigation in a contested environment, etc.), to develop a new generation of offensive and deceptive weapons and effectors.
2021 will be a decisive year for several key future defence capabilities in Europe. The SAMP/T NG contract awarded by OCCAR on 19 March will give France and Italy an enhanced capability to guarantee their airspace sovereignty, and protect their population, territory and troops-on-operations against new emerging threats. France and the United Kingdom shall take further steps in their cooperation under the Lancaster House Treaty framework by launching the assessment phase for the FC/ASW programme, and will continue to strengthen their technological base for generation-after-next missile systems by renewing their commitment to the Complex Weapon Innovation & Technological Partnership (CW-ITP). MBDA will continue to invest in cooperation for the endo-atmospheric interceptor that could be the backbone of the wider TWISTER (Timely Warning Interceptor with Space-based TheatER surveillance) programme launched under the EU PESCO framework, to provide a European contribution to NATO Ballistic-Missile Defence (BMD). As member of two partnerships producing next generation Future Combat Air Systems (Tempest / SCAF), MBDA will continue to mature capable, affordable, upgradeable, connected and cooperative effectors for future air dominance.
30 Mar 21. China’s Geely to set up new aerospace company. China’s Zhejiang Geely Holding Group plans to set up a commercial aerospace company to develop its satellite and communications technologies in the southern city of Guangzhou, local government said on Tuesday. Geely, which owns Volvo Cars and 9.7% of Daimler AG, will also work with other rocket companies in Guangzhou, the government said. The company was not immediately available for comment after usual business hours. Geely is building low-orbit satellites to meet demand for high-speed connectivity capabilities that can deliver fast software updates. From around 2025, Geely’s cars will have more functions to connect to the satellites. (Source: Reuters)
30 Mar 21. TAT Technologies Reports 2020 Results. TAT Technologies Ltd. (NASDAQ: TATT) (“TAT” or the “Company”), a leading provider of products and services to the commercial and military aerospace and ground defense industries, reported today its audited results for the twelve months ended December 31, 2020.
Key Financial Highlights (*):
- Total revenues for the twelve months ended December 31, 2020 were $75.3m compared to $97.4m for the twelve months ended December 31, 2019, a decrease of 22.7%. The decrease in revenues was the result of the COVID-19 pandemic outbreak which has significant effect on the commercial aviation industry.
- Gross profit for the twelve months ended December 31, 2020 were $8.4m (11.2% of revenues) compared to $15.3m (15.7% of revenues) for the twelve months ended December 31, 2019, a decrease of 44.8%. The decline in gross profit was mainly due to decrease in revenues and fixed charges on the COGS.
- Adjusted EBITDA for the twelve months ended December 31, 2020 was $1.1m compared to $7.1m for the twelve months ended December 31, 2019.
- GAAP net loss from continued operations for the twelve months ended December 31, 2020 was $3.5m compared to GAAP net income of $1.5 m for the twelve months ended December 31, 2019. GAAP net income from continued operations for the twelve months ended December 31, 2020 included one-time expenses of approximately $0.8m.
- Cash net of debt for December 31, 2020 was $16.2m compared to $16.0m for December 31, 2019. During 2020, the Company made significant capital investments related to the two large agreements with Honeywell. Nevertheless, the improvement in cash was mainly due to improved working capital management.
* Financial results for fiscal year 2019 reclassified due to discontinued operation.
Mr. Igal Zamir, CEO and President of TAT Technologies stated, “2020 was a unique and challenging year for the aerospace industry and for TAT. TAT has reacted quickly in early 2020 to the changing environment and adjusted its cost structure to the new environment. We managed to conclude 2020 with positive EBITDA and slight increase in our net cash balance after making some meaningful investments related to the two new strategic agreements with Honeywell. These investments are reflected in the inventory and property, plant and equipment line items in our balance sheet. During 2020, we signed two strategic agreements with Honeywell that are related to MRO services to APU 331-200 and APU 331-500. We believe that such agreements position TAT (through its Piedmont subsidiary) as a global premier MRO services provider. We also believe that the Company would generate significant business and revenues from these two agreements. In addition, TAT has been working on other operational rationalization activities that are expected to yield significant cost savings starting from late 2021. We expect to enjoy the full impact of our above mentioned activities when the industry starts recovering from the COVID 19 crisis. (Source: PR Newswire)
30 Mar 21. 5N Plus to Acquire AZUR SPACE. 5N Plus Inc. (TSX: VNP) (“5N Plus” or the “Company”), a leading global producer of specialty semiconductors and performance materials, today announced that it has entered into an agreement with AZUR SPACE Solar Power GmbH (“AZUR”) pursuant to which 5N Plus would acquire all of the issued and outstanding shares of AZUR (the “Transaction”). The Transaction is subject to the customary closing conditions, including regulatory approvals. 5N Plus will fully integrate AZUR’s workforce and will appoint Mr. Jürgen Heizmann, Managing Director of AZUR, as a member of 5N Plus’s Executive Committee.
Located in Heilbronn, Germany with a workforce of 240 employees, AZUR is a global leader in developing and manufacturing multi-junction solar cells for space and terrestrial concentrated photovoltaic (“PV”) applications. 5N Plus is headquartered in Montreal and operates R&D, manufacturing and commercial centers in several locations in North America, Asia and Europe, including three in Germany and one in Belgium. The Company is a leading supplier to the thin-film PV renewable energy industry and a notable supplier within the U.S. satellite supply chain. The integration of AZUR will not only expand the Company’s position within renewable energy, but, through Canada’s membership in the European Space Agency (ESA), will also establish 5N Plus as a reliable and competitive supplier to the European and U.S. space programs.
“This acquisition is the foundation of a strategic transformation that will unlock notable market potential,” said Arjang Roshan, President and Chief Executive Officer of 5N Plus. “AZUR and 5N Plus complement each other, and our integration will culminate in a sustainable supply chain which will ensure the competitiveness and security of supply for our customers and government agencies. Moreover, the combined value chain will serve as a gateway to new businesses with significantly larger total addressable market. We deem AZUR’s activities in Heilbronn, Germany, along with those of 5N Plus in St. George, Utah, and Montreal, Québec, as essential to this plan. We are eager to welcome our new colleagues and collaboratively embark on this new journey.”
Terms of the Transaction
5N Plus will acquire all of the issued and outstanding shares of AZUR for an expected total purchase price between 73-79m euros subject to prevailing closing adjustments. This includes 6.5m shares of 5N Plus, subject to the TSX approval, to be issued from treasury at closing and cash payment. The sum of these two items will be approximately 53m euros, subject to the volume-weighted average closing share price of 5N Plus prior to closing. Furthermore, 5N Plus expects to finance working capital in the range of 20 to 26m euros with provision not to exceed 27m euros. The cash portion of the Transaction is expected to be funded through a senior debt facility.
AZUR’s most recent annual revenue was in excess of 50m euros with average three-year annual EBITDA1 of about 6m euros. Notwithstanding the realization of expected cost and revenue synergies, and without consideration of integration expenses and transaction costs, management estimates that the EV/Adjusted EBITDA1 multiple for the Transaction to be well aligned with 5N Plus. Post Transaction, pro forma net debt1 to Adjusted EBITDA is expected to be in the range of 2.8 times multiple with a projected target of about 2.2 times multiple within 18 to 24 months post-closing.
In connection with the Transaction, 5N Plus has received Canadian legal advice from Dentons and German legal advice from Luther.
About 5N Plus Inc.
5N Plus is a leading global producer of specialty semiconductors and performance materials. The Company’s ultra-pure materials often form the core element of its customer products. These customers rely on 5N Plus’s products to enable performance and sustainability in their own products. 5N Plus deploys a range of proprietary and proven technologies to develop and manufacture its products. The Company’s products enable various applications in a number of key industries including renewable energy, security, space, pharmaceutical, medical imaging, and industrial and additive manufacturing. Headquartered in Montreal, Québec, 5N Plus operates R&D, manufacturing and commercial centers in strategically located facilities around the world including Europe, North America and Asia. The Company’s mission is to be critical to its customers, valued by its employees and trusted by its shareholders. The Company’s core values focus on integrity, commitment and customer development along with emphasis on sustainable development, continuous improvement, health and safety. www.5nplus.com. (Source: PR Newswire)
30 Mar 21. COMSovereign Reports 2020 Annual Results. Foundational Year Focused on Building Infrastructure to Support Significant Growth in 2021. COMSovereign Holding Corp. (NASDAQ: COMS) (“COMSovereign” or “Company”), a U.S.-based developer of 4G LTE Advanced and 5G Communication Systems and Solutions, today reported financial results for the fiscal year ended December 31, 2020.
- Full year 2020 revenues were $9,426,836 driven by sales of DragonWave mobile network backhaul products, the acquisition of Sovereign Plastics and Virtual NetCom, initial test-market sale of certain high-performance after-market models of the Company’s intelligent batteries, and a full year of revenue for aerostat products and accessories.
- Gross profit for the year ended December 31, 2020 was $4,830,875, with a gross profit margin of 51%. Gross profit reflects an increased gross profit margin for DragonWave during the year and the inclusion of a full year of operating results for Drone Aviation and most of the year for Sovereign Plastics, which were acquired on November 27, 2019 and March 6, 2020, respectively.
- The Company ended the year with $730,502 in cash. Subsequent to the close of the year, the Company secured approximately $45m in gross proceeds from capital raised in January and February 2021 and utilized a portion of the proceeds of these offerings to pay off maturing debt and accrued interest which totaled $20.4m including debt converted to equity.
- Investors can view the complete 10-K filing at www.sec.gov or on the Company’s website at https://investors.comsovereign.com/SEC-Filings
“Our fiscal year ended 2020 was focused on readying the business to capitalize on the opportunity of American-made 4G and 5G by integrating and streamlining our existing operations and expanding our capabilities through the additions of Virtual NetCom and Sovereign Plastics,” said Dan Hodges, Chairman and CEO of COMSovereign Holding Corp. “Against the many challenges brought on by COVID-19, operationally, we were able to achieve a number of important milestones in 2020 which have laid the foundation for significant growth expected this year. These milestones include opening our new HQ in Dallas, expanding our management teams, advancing development of our unique and patented radio technologies, preparing for our up-listing on Nasdaq and the raising of capital which the Company secured early in the first quarter of 2021.”
Looking ahead in 2021:
- Supported by over $43m in new equity capital raised in the first quarter of 2021, the Company has begun to ramp up production of products including standing-up manufacturing operations at its new 140,000 sq. ft. facility in Tucson, AZ. which will enable to produce its full range of next-gen products internally.
- Starting in the second quarter of 2021, revenues will begin to reflect increasing production and sale of backhaul radio products from DragonWave produced at its contract manufacturing partner, Benchmark Electronics, Inc. There will also be contributions from InduraPower and recent acquisitions including FastBack Networks and Sky Sapience which will be produced in-house in Tucson as well.
- The Company expects a steady production increase of its radio, drone and battery products which will drive increased revenue throughout the second half of 2021, further accelerating into 2022 as in-house manufacturing ramps up as well.
- The Company continues to seek accretive acquisitions that will complement its solution set, further establishing the Company as one of the only U.S.-based telecom hardware and software provider able to deliver end-to-end products and services supporting 4G LTE and 5G networks now being deployed by operators around the world.
- An updated corporate presentation on COMSovereign can be viewed on the Company’s website at https://investors.comsovereign.com/Presentations
“My top priorities as CFO are to make sure that the business is supported by an effective and efficient financial organization and to ensure we provide the markets with timely transparency into our operational results. This includes a commitment for scheduled releases of quarterly financial results and investor conference calls commencing with the filing of our fiscal first quarter 2021 10-Q. As we move through the first and second quarters of 2021 where our business and revenues will begin to accelerate, we are dedicated to supporting the needs of our shareholders, customers and partners,” added Marty Wade, Chief Financial Officer of COMSovereign Holding Corp.
For more information about COMSovereign, please visit www.COMSovereign.com and connect with us on Facebook and Twitter.
About COMSovereign Holding Corp.
COMSovereign Holding Corp. (Nasdaq: COMS) has assembled a portfolio of communications technology companies that enhance connectivity across the entire data transmission spectrum. Through strategic acquisitions and organic research and development efforts, COMSovereign has become a U.S.-based communications provider able to provide 4G LTE Advanced and 5G-NR telecom solutions to network operators and enterprises. For more information about COMSovereign, please visit www.COMSovereign.com.
(Source: PR Newswire)
30 Mar 21. Cathie Wood’s space ETF fails to lift off in debut. Shares of star investor Cathie Wood’s ARK Space Exploration & Innovation ETF failed to lift off on Tuesday in their Wall Street debut.
Ark Investment Management’s latest exchange traded fund focuses on companies related to orbital and sub-orbital space, enabling technologies, and also those that stand to benefit from aerospace activities, according to its prospectus. Its shares were last down 0.9%.
The actively managed fund’s top holding is software maker Trimble Inc, followed by 3D Printing ETF and Kratos Defense and Security Solutions Inc.
JD.com, Lockheed Martin Corp, Nvidia, Amazon, Alphabet and Boeing are also among the fund’s 38 holdings.
Wood’s flagship $22bn Ark Innovation fund is popular with retail investors after more than doubling in the past 12 months, with top holdings including Tesla and Square.
The Ark Innovation fund was up 2.7% on Tuesday, but it remains down 8% so far in 2021, hit by a shift by investors toward companies viewed as likely to benefit the most from a recovering economy in the wake of the coronavirus pandemic. Other ETFs run by Ark Investment Management focus on genomics, autonomous cars and financial technology. (Source: Reuters)
29 Mar 21. MHI to take over Mitsui E&S’s shipbuilding business. Japan’s Mitsubishi Heavy Industries (MHI) has concluded an agreement with Mitsui E&S Holdings to take over the latter’s ‘naval and governmental ships business’, which includes the development and construction of autonomous underwater and autonomous surface vehicles (AUVs and ASVs).
The deal, which was announced on 29 March, is the result of formal negotiations between the two companies that began in June 2020. Both firms said they want to complete the transfer by October after getting approval from regulators.
The acquisition will reduce the number of local shipbuilders making vessels for the Japan Maritime Self-Defense Force (JMSDF) and the Japan Coast Guard (JCG) from four to three, with the other companies being Kawasaki Heavy Industries (KHI) and Japan Marine United Corporation (JMU).
MHI said in a statement that the move will strengthen its defence shipbuilding operations. “Mitsui E&S Shipbuilding, an operating company of Mitsui E&S Holdings, has strengths in the construction and repair of auxiliary ships, such as supply ships and oceanographic survey ships for Japan’s Ministry of Defense, as well as governmental ships such as vessels for patrolling local fishing waters,” it noted.
MHI’s naval shipbuilding activity is centred around its Nagasaki Shipyard & Machinery Works. The corporation has developed and built submarines and nearly all types of surface combatants for the JMSDF. (Source: Jane’s)
29 Mar 21. German government buys stake in defense supplier Hensoldt. The German government is buying a minority stake in defense supplier Hensoldt, a company that derives from European aircraft manufacturer Airbus’ former defense and security electronics division.
The state-owned KfW development bank said Monday that it was buying 25.1 percent of the shares in Hensoldt on behalf of the federal government in Berlin. That gives the government a blocking minority under German law.
KfW didn’t detail the value of the purchase.
Germany’s Cabinet decided in December to buy the stake to prevent “unfriendly powers” from acquiring materiel such as sensors and encryption technology for military use, news agency dpa reported.
Among other things, Hensoldt supplies components for Eurofighter planes.
The Taufkirchen-based firm has about 5,600 employees, and it reported revenue of €1.2bn (U.S. $1.4bn) last year. It also ranked 67th place in last year’s list of the top 100 defense companies around the world by Defense News. (Source: glstrade.com/Defense News)
29 Mar 21. AMETEK Announces Three Acquisitions.
– Magnetrol International Expands AMETEK’s Leading Level Measurement Solutions –
– Crank Software Provides Leading Graphical User Interface Design Capabilities –
– EGS Automation Enhances AMETEK Dunkermotoren’s Automation Solutions Portfolio –
AMETEK, Inc. (NYSE: AME) today announced that it has completed three acquisitions – Magnetrol International, Crank Software and EGS Automation (EGS). Approximately $270m was deployed on these acquisitions which have combined annual sales of approximately $120m.
“We are pleased to welcome the Magnetrol, Crank Software and EGS teams to AMETEK,” commented David A. Zapico, AMETEK Chairman and Chief Executive Officer. “Each of these businesses provide AMETEK with unique capabilities which strategically expand our presence in attractive growth areas. We continue to strengthen our portfolio through the acquisition of market-leading businesses with innovative, advanced technology solutions. We are pleased with this recent acquisition activity and continue to manage an active deal pipeline with exciting opportunities for growth.”
Magnetrol and Crank Software join AMETEK as part of its Electronic Instruments Group (EIG) – a leader in advanced analytical, monitoring, testing, calibrating and display instruments. EGS Automation joins AMETEK’s Electromechanical Group (EMG) – a differentiated supplier of thermal management systems, and automation and engineered solutions.
Headquartered in Aurora, Illinois, Magnetrol is a leading provider of level and flow control solutions for challenging process applications across a diverse set of end markets including medical, pharmaceutical, oil and gas, food and beverage, and general industrial. Magnetrol’s portfolio of mission-critical products are designed to optimize processes, maximize yields, and ensure safety.
“Magnetrol is an excellent acquisition for AMETEK and nicely complements our Sensors, Test and Calibration (STC) business,” added Mr. Zapico. “Combined, Magnetrol and STC become an industry leading, differentiated sensor platform with a broad range of level and flow measurement solutions.”
Headquartered in Ottawa, Canada, Crank Software is a leading provider of embedded graphical user interface (GUI) software and services. Storyboard – the company’s flagship offering – is a premier, innovative solution that enables the design and development of customized user experiences in a wide range of embedded products. Crank Software also offers a unique and customizable set of professional services that takes customers from concept to completion in their GUI design and development cycle.
“Crank Software is an exciting acquisition for AMETEK and an excellent addition to our growing portfolio of software solutions,” continued Mr. Zapico. “Their award-winning Storyboard platform and service capabilities are positioned well to capitalize on the accelerating demand for smart, digitally enabled devices across a variety of end markets.”
Headquartered in Donaueschingen, Germany, EGS is an automation solutions provider that designs and manufactures highly engineered, customized robotic solutions used in critical applications for the medical, food and beverage, and general industrial markets.
“EGS nicely complements our AMETEK Dunkermotoren business with highly customizable engineering design and automation capabilities,” commented Mr. Zapico. “The combination of EGS and Dunkermotoren provides a broader suite of automation solutions and expands our presence in this attractive market.”
AMETEK is a leading global manufacturer of electronic instruments and electromechanical devices with annual sales in 2020 of more than $4.5bn. The AMETEK Growth Model integrates the Four Growth Strategies – Operational Excellence, New Product Development, Global and Market Expansion, and Strategic Acquisitions – with a disciplined focus on cash generation and capital deployment. AMETEK’s objective is double-digit percentage growth in earnings per share over the business cycle and a superior return on total capital. The common stock of AMETEK is a component of the S&P 500. (Source: PR Newswire)
28 Mar 21. Spy chiefs plough £100m into British tech firms. So far the security services venture capital wing has only announced one direct investment into a technology start-up. The security services have dramatically increased the amount they invest into British technology companies by backing seven venture capital funds with £100m.
The National Security Strategic Investment Fund (NSSIF), which invests on behalf of spy agencies as well as the armed forces, has upped the number of funds it backs from a single known fund last year to a total of seven investment firms.
Albion VC, GoCardless backer Notion Capital, Dawn Capital, Longwall Ventures, Oxx Capital, Evolution Equity Partners and Amadeus Capital have all received significant amounts of funding from NSSIF.
NSSIF was a key backer of the Government’s £400m purchase of a stake in collapsed satellite business OneWeb and has begun making its own direct investments into British start-ups in recent years.
The seven venture capital funds will invest more than £10m each on behalf of the security services into start-ups in fields such as quantum computing as well as chip production and encryption.
“We’ve gone through the approval process and are now working with them closely to identify investments that we’re making that might fall within their focus, from obvious things like AI through to semiconductors and quantum computing,” said Ed Lascelles, a partner at Albion VC.
“These are all areas that we invest in anyway and so far, early on, it’s been an excellent partnership,” Mr Lascelles added.
The Sunday Telegraph revealed last year that Amadeus Capital, the investment fund co-founded by veteran technology entrepreneur Hermann Hauser, was an NSSIF partner and had been handed around £25m in funding to invest on behalf of the Government.
Insiders say the six other funds are likely to have received smaller amounts that are in relation to the size of their existing funds.
A spokesman for the British Business Bank, which manages NSSIF, said that “we invest alongside leading venture investment funds with strong track records in supporting innovation, with the aim of developing dual-use capabilities or strengthening the UK’s technology ecosystem.”
NSSIF’s links with the UK’s venture capital are likely to deepen in the coming months with a partnership with an eighth firm due to be announced in the future, insiders said.
So far only a single direct investment made by NSSIF through its British Technology Investments wing has been made public.
Last year, the fund took a 3.1pc stake in quantum computing business Quantum Motion which is hoping to reduce the size of the breakthrough computers using existing chips rather than specialist hardware.
NSSIF has also disclosed that it has worked with three other British start-ups since its launch in 2018.
The fund introduced Hazy, a Kent start-up that creates synthetic data that can be used and analysed instead of sensitive information, to an unnamed “Government customer,” NSSIF wrote on its website.
NSSIF also worked with secure messaging system Element as well as online training service Codility, the fund has said. (Source: Daily Telegraph)
28 Mar 21. Darktrace valued at over $3bn ahead of IPO. Shareholders privately value UK cybersecurity company at double valuation of last fundraising. The British cybersecurity company Darktrace has been privately valued at more than $3bn (£2.2bn) as it prepares to join a parade of London tech listings.
Shareholders have raised the estimated value of their holdings in the start-up – backed by the controversial tech entrepreneur Mike Lynch – since the start of this year.
US fund Sharespost has increased the fair value of its Darktrace stake to $1,438 a share, up 40pc on what the stock was bought at in December, according to a recent filing.
This is believed to value the company at roughly double the $1.6bn valuation of its last publicly-announced fundraising in 2018. Another investor said they had marked up their shares to a similar level.
Darktrace uses artificial intelligence technology pioneered at the University of Cambridge to root out intruders in companies’ computer systems. It is hoping to join the likes of Deliveroo and Trustpilot in a string of billion-pound technology companies seeking to go public in London. Bankers are targeting a valuation of up to $5bn for Darktrace, with the float expected in the first half of this year.
The sum would mean a substantial payday for Mr Lynch’s venture capital firm Invoke, which was Darktrace’s first major investor in 2013.
Darktrace has beefed up its board ahead of going public, adding former Capita finance chief Gordon Hurst as chairman as well as new non-executive directors Sir Peter Bonfield, Lord Willetts and Paul Harrison.
However, the company’s plans have been hit by the departure of investment bank UBS, which resigned from the float due to compliance issues raised by the extradition proceedings surrounding Mr Lynch.
Mr Lynch, the founder of the former FTSE 100 software company Autonomy, faces fraud charges in America if the US government is successful in extraditing him.
The Department of Justice has accused him of fraud over Autonomy’s sale to HP in 2011, charges that Mr Lynch denies. He stepped down from Darktrace’s board in 2018 after being charged but Invoke remains a significant shareholder. (Source: Daily Telegraph)
25 Mar 21. Marlink Acquires Global Eagle’s Customer Base. As part of this deal, Marlink has taken over more than 450 VSAT sites in five continents that serve large humanitarian/NGO, Embassy, Oil and Gas and Mining customers, as well as GEE’s African fixed site land business.
The transaction is the result of an efficient collaboration between Marlink and GEE teams which was aimed at structuring a deal ensuring service continuity for GEE’s NGO/humanitarian and enterprise customers.
This acquisition will further strengthen Marlink’s global leadership position and momentum in the enterprise SATCOM market serving NGO/humanitarian, energy/mining and government customers.
“Marlink welcomes GEE’s NGO/humanitarian and enterprise customers and is geared up to provide them with a best-in-class service given the depth of our experience and resources in these sectors,” said Alexandre de Luca, President, Enterprise, Marlink. “Marlink’s managed smart network solutions provide our customers with reliable, scalable and flexible connectivity and digital solutions that enables them to run their remote operations in more efficient, sustainable and safe ways.” (Source: Satnews)
25 Mar 21. Redwire, An Innovative Space Infrastructure Company Serving The Fast-Growing Space Industry, To Become Publicly Traded Through Merger With Genesis Park Acquisition Corp.
– Redwire is a pure play space infrastructure company providing critical technology and services to fast-growing national security, civil, and commercial markets
– Global space economy growing rapidly, projected to exceed $2trn in 2040
– Business combination values Redwire at a pro forma enterprise value of $615m; transaction expected to deliver approximately $170m cash to the Redwire balance sheet (assuming no redemptions)
– Includes a fully committed and oversubscribed $100m common stock PIPE with participation by Senvest Management, LLC and Crescent Park Management, L.P.
– Proven management team and 50+ years of space heritage and deep customer relationships in space and aerospace
– Undisputed leader in rapidly expanding 3D printing/manufacturing and robotic assembly in space, which is critical to the future of space infrastructure solutions
– Strong financial foundation with current revenue, EBITDA, and free cash flow
– Projected 2021 revenue of $163m and forecasted 72% 2021E – 2025E revenue CAGR, with positive and growing Adj. EBITDA and cash flow driven by an over $23bn pipeline of identifiable contracts
– Current Redwire stockholders, Genesis Park stockholders and PIPE investors will hold shares in the combined company to be listed on the NYSE
Redwire (or “the Company”), a leader in mission-critical space solutions and high reliability components for the next generation space economy, and Genesis Park Acquisition Corp. (NYSE: GNPK) (“Genesis Park”), a publicly traded special purpose acquisition company, announced today that they have entered into a definitive merger agreement that will result in Redwire becoming a publicly traded company. The transaction is expected to be completed by the end of the second quarter of 2021, and at that time, Genesis Park Acquisition Corp. will change its name to Redwire and the company will trade on the NYSE.
Redwire provides critical space infrastructure technology and services and is uniquely positioned to deliver critical solutions to meet the growing needs of national security, civil, and commercial customers for a full spectrum of activity in space. The Company is differentiated from its peers because it offers both rich flight heritage, with more than 50 years of space flight experience and more than 150 missions flown, and unmatched innovations in space infrastructure, including over 100 patents and applications. Its infrastructure and services enable nearly every space mission, and Redwire sees increasing opportunities as decreasing launch costs continue to enable exponential growth in deployed space infrastructure.
Redwire is the leading developer of on-orbit servicing, assembly and manufacturing (“OSAM”) capabilities, a transformational technology deploying 3D printing that enables customers to build satellites and other spacecraft in space, solving the size and other limitations posed by launch dynamics. Through the launch of raw materials into orbit, in-space manufacturing of component parts through 3D printing and other methods, and robotic assembly of highly functional objects, Redwire’s OSAM technology enables lower cost deployment and higher power capabilities. The advantages of Redwire’s in-space manufacturing will allow its customers to efficiently create more advanced products in space with greater performance characteristics than terrestrial based manufacturing methods, driving increased investment in space infrastructure from adjacent markets and the commercialization of space.
“Space-based capabilities and services are improving lives on Earth every day, and Redwire is an invaluable mission partner, providing technology that has been at the forefront of space infrastructure from the beginning. Today, the influx of private capital, new public sector space initiatives and decreased launch costs are driving tremendous growth in the space industry, which is projected to exceed $2trn by 2040,” said Peter Cannito, Chairman and CEO of Redwire. “With our extensive space flight heritage and deeply innovative capabilities, we are accelerating humanity’s expansion into space by delivering reliable, economical and sustainable infrastructure for future generations. As we enter this second golden age of space, Redwire is supplying the picks and shovels that enable nearly every space mission, supporting initiatives to help us better understand our planet, transform our space security infrastructure, and move humanity deeper into our solar system. We are thrilled to enter into this business combination with Genesis Park. With their extensive aerospace, operational and financial expertise and strong industry relationships, we are confident that Genesis Park is the right partner to propel Redwire’s growth in the public market.”
“We intended to find a profitable partner with strong management, powerful intellectual property and impressive organic growth. Redwire achieves that vision by transforming the future of space infrastructure and services at a time when the space industry is on the brink of exponential growth. Redwire is a proven, solidly profitable player in the space community and the undisputed leader in on-orbit 3D printing, servicing, assembly, and manufacturing. We also believe there is significant opportunity to accelerate growth through strategic combinations in the fragmented space landscape. Redwire has established itself as a first-mover consolidator and an acquirer of choice, and we believe its position will be further improved as a public company,” said Paul Hobby, CEO and Director of Genesis Park. “We are very excited about Redwire’s growth potential and we look forward to partnering with Peter and his team as they help usher in this new era of space exploration.”
“As an innovative space infrastructure leader, Redwire is set to power a new age of space travel, exploration and commerce,” said Kirk Konert, Partner at AE Industrial Partners. “With this transaction, Redwire will have even greater opportunities to drive growth and value by delivering tailored, responsive solutions for its growing customer base across the public and private sectors.”
- Applying proven capabilities and transformative technologies in five key strategic growth areas that will enable space missions of today and tomorrow: The Company has numerous organic growth opportunities without substantial capital needs driven by its proven capabilities and transformative technologies. Its investments are focused in five key strategic growth areas that will expand the utilization of space and promote a sustainable low-earth orbit economy: (i) on-orbit servicing, assembly and manufacturing; (ii) low Earth orbit commercialization; (iii) digitally engineered spacecraft; (iv) space domain awareness; and (v) advanced sensors and components.
- Significant opportunity to continue consolidating a fragmented space infrastructure market: The proceeds from the proposed transaction enable Redwire to accelerate and de-risk growth plans and pursue targeted acquisitions. Redwire has a proven track record of successful acquisitions and integrations, and typically leverages company founders’ expertise and relationships to bolster leadership ranks and expand the M&A pipeline.
- High visibility into near- and long-term revenue streams: Redwire has a diversified revenue base, with products and services demanded by national security, civil and commercial customers and more than $150m in contracted backlog. The Company is projecting 72% estimated revenue compound annual growth rate, from $163m in 2021 to $1.4bn in 2025. Redwire’s integration expertise make it a prime candidate for margin improvement as it integrates and scales operations.
Key Transaction Terms
The transaction values Redwire at a $615m pro forma enterprise value, representing 9.6x estimated 2023 Adjusted EBITDA of approximately $64m and 2.5x estimated 2025 Adjusted EBITDA of approximately $250m. Assuming no redemptions by Genesis Park stockholders, the Proposed Transaction is expected to deliver approximately $170m cash to the Redwire balance sheet. The proposed transaction is further supported by a $100m fully committed and oversubscribed PIPE of common stock, priced at $10.00 per share, with participation by Senvest Management, LLC and Crescent Park Management, L.P.
Redwire’s existing stockholders will hold approximately 55% of the fully diluted shares of common stock immediately following the closing of the business combination, assuming no redemptions by Genesis Park’s existing public stockholders. AE Industrial Partners will remain a significant shareholder in Redwire following the completion of the proposed merger.
The transaction, which has been unanimously approved by the Boards of Directors of Redwire and Genesis Park, is subject to approval by Genesis Park’s shareholders and other customary closing conditions.
Following the closing of the transaction, Redwire will continue to be led by Chairman and CEO Peter Cannito. The Redwire Board will be comprised of current Redwire Board members Pete Cannito, Dr. Reggie Brothers, Joanne Isham and Kirk Konert, along with Jonathan Baliff President, CFO & Director of Genesis Park; John Bolton, Advisor to Genesis Park and Les Daniels, Operating Partner of AE Industrial Partners.
Additional information about the proposed transaction, including a copy of the merger agreement and investor presentation, will be available in a Current Report on Form 8-K to be filed by Genesis Park with the Securities and Exchange Commission and at www.sec.gov. The investor presentation can also be found on https://www.genesis-park.com/redwire.
(Source: PR Newswire)
25 Mar 21. Coherent Board Accepts II-VI Acquisition Proposal. Terminating Lumentum Merger Agreement. Entering Into Merger Agreement with II-VI on Terms of March 17, 2021 Proposal. Coherent, Inc. (NASDAQ: COHR) today announced that its board of directors has determined, after consultation with its financial and legal advisors, that the previously disclosed acquisition proposal Coherent received from II-VI Incorporated (NASDAQ: IIVI) on March 17, 2021 continues to be a “Company Superior Proposal” under Coherent’s March 9, 2021 merger agreement with Lumentum Holdings Inc. (NASDAQ: LITE) after giving due consideration to the revised acquisition proposal Coherent received from Lumentum on March 22, 2021. In making its determination, the Coherent board of directors evaluated the comparative benefits and risks of the II-VI and Lumentum proposals, including the near-term and long-term financial opportunities and risks presented by each proposal, the potential synergies available through a combination with each company, and the complementary businesses of each company.
Accordingly, Coherent is terminating the March 9, 2021 merger agreement between Coherent and Lumentum and paying Lumentum the $217.6m termination fee contemplated by their merger agreement in order to enter into a new merger agreement with II-VI.
Under the terms of Coherent’s merger agreement with II-VI, each share of Coherent common stock will be exchanged for $220.00 in cash and 0.91 of a share of II-VI common stock at the completion of the transaction. The transaction with II-VI is subject to approval by the stockholders of Coherent and II-VI, receipt of U.S. and foreign regulatory approvals and other customary closing conditions. The transaction is expected to close in the fourth quarter of 2021.
Bank of America and Credit Suisse are serving as financial advisors to Coherent, and Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal advisor.
Founded in 1966, Coherent, Inc. (“Coherent”) is a global provider of lasers and laser-based technology for scientific, commercial and industrial customers. Our common stock is listed on the Nasdaq Global Select Market and is part of the Russell 1000 and Standard & Poor’s MidCap 400 Index. For more information about Coherent, visit the company’s website at https://www.Coherent.com for product and financial updates. (Source: PR Newswire)
25 Mar 21. Leonardo/DRS: tanks but no thanks, say US investors. Minority shareholders must feel like spectators in a business where politics and commerce interweave. A large state shareholding is one reason Leonardo’s shares trade at a discount of about a half to European peers. Cuts to US military budgets have suppressed the appetites of defence investors, Alessandro Profumo, chief executive of Leonardo, told reporters on Thursday. The Italian aerospace and defence group put plans for a partial float of American electronics subsidiary DRS on hold earlier this week. That is a spanner in works for Profumo. He had planned to use proceeds of about $700m to fund acquisitions in Europe. The sale would have unlocked value for long-suffering Leonardo minority shareholders. They must feel like spectators in a business where politics and commerce interweave. The outlook for DRS may not be as gloomy as the float postponement suggests. Conflicts in Ukraine and Syria were a wake-up call for some Nato powers. They realised they would be weak in a direct confrontation with Russia or China. Budgets focused on combating insurgencies in Iraq and Afghanistan are reorienting to conventional warfare. DRS, which specialises in electronics for ships and armoured vehicles, should benefit. DRS’s mooted $3.1bn valuation is well below the $5.2bn Leonardo (then Finmeccanica) paid in 2008. The overpriced deal stopped the acquirer from making further inroads into the US. Even at its current suggested worth, DRS would command an ebitda multiple of 15 times — steep for a US business of this kind. It was evidently too rich to entice US investors to sign up as minority investors. A large state shareholding is one reason Leonardo’s own shares trade at a discount of about a half to European peers. The sale or reform of underperforming civil aviation divisions in Italy would help close that gap. It would demonstrate a political will to make tough decisions in the cause of efficiency. Unfortunately, Italian politicians enjoy interfering in business. Nowhere is this easier than in defence companies, heavily reliant on orders from the state. The prospect of conflicted Leonardo as controlling shareholder may have deterred US investors just as much as DRS’s anticipated valuation. (Source: FT.com)
TCI International, Inc., is a wholly-owned subsidiary of SPX Corporation. TCI provides turn-key solutions for spectrum management and monitoring, direction finding, geolocation and communications intelligence to civilian, government, military and intelligence agencies as well as antennas for communications and high-power radio broadcasting. TCI is headquartered in Fremont, California, USA. For more information, visit www.tcibr.com.