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05 Apr 24. Hanwha Aerospace to focus on defense business after spinoff. Hanwha Aerospace Co., a South Korean defense company, said Friday it will focus on the defense and aviation business after spinning off two affiliates by September.
Hanwha Aerospace will spin off its two wholly owned units — artificial intelligence solutions firm Hanwha Vision and semiconductors equipment maker Hanwha Precision Machinery Co. — to be placed under Hanwha Industrial Solutions, which will be established soon, the company said in a statement.
“Through the business reorganization, the company (Hanwha Aerospace) aims to become a comprehensive defense solutions provider in global markets with a business portfolio that covers land, ocean and aerospace fields,” the statement said.
After the planned spin-off, Hanwha Aerospace will have defense solutions provider Hanwha Systems and shipbuilder Hanwha Ocean as affiliates, while Hanwha Precision and Hanwha Vision will be wholly owned by the new company.
Hanwha Corp., the de facto holding company of chemical-to-defense conglomerate Hanwha Group, will have a 33.95 percent stake each in Hanwha Aerospace and the new company. (Source: Google/Yonhap)
04 Apr 24. Austal leaves door ajar in takeover bid from Hanwha Ocean. Despite an initial rejection from Austal, South Korean firm Hanwha Ocean’s bid to buy out the Australian shipbuilder has some analysts pondering the benefits of such deal.
Jennifer Parker, a naval analyst at the National Security College within the Australian National University, told Defense News: “If you think about what Australia is trying to achieve with its continuous shipbuilding, think about the fact that a lack of Australian ownership is not a barrier for being a sovereign defense industrial base, then I think there’s a lot of opportunity.”
Yet one obstacle to a takeover is regulatory approval from authorities like Australia’s Foreign Investment Review Board (FIRB). In an April 2 press release, Austal said it was “not satisfied that these mandatory approvals would be secured.”
Hanwha Executive Vice President David Kim responded: “There is no foundation of the claim that the FIRB would reject Hanwha’s acquisition of the company.” The South Korean company has previously obtained the board’s approval for investments in Australian armored vehicles.
Domestic opportunities certainly abound. Australia’s recent surface combatant fleet review recommended three general-purpose frigates be built overseas and eight in Western Australia. Korea’s FFX-III frigate, which Hanwha Ocean is helping build, is one of four shortlisted designs.
Hanwha’s acquisition of Austal would increase the chances of swaying the competition in favor of that ship design, Parker noted.
Furthermore, announced last November, Austal has a pilot agreement with Australia’s Department of Defence to act as strategic partner in Western Australia. Already, Austal has landing craft and patrol boats in its order book.
Parker highlighted the Korean conglomerate’s desire for a Five Eyes foothold, a reference to the intelligence-sharing club of New Zealand, Australia, Canada, Britain and the United States. “I think that for Hanwha, who wants to get into the Five Eyes market, it sees that the industrial capacity of the U.S., Australia, New Zealand, Canada to build the ships they want is just not there.”
The prize of Austal USA, a supplier of U.S. Navy vessels, presumably enters Hanwha’s calculus, even if this subsidiary has relative autonomy from Austal Australia.
American shipbuilders might be reluctant about a Korean competitor appearing, but Parker wondered whether the U.S. should not be leaning more on South Korea for assistance in producing ships. “We know the U.S. industrial base is struggling to produce ships and submarines … so there’s opportunity there,” she argued.
Parker highlighted different ideas over what “sovereign” actually means when it comes to serving the Australian market. According to the government’s “Defence Industry Development Strategy,” released in February, Australian ownership is not critical to sovereignty. Apart from the public optics of a 36-year-old Australian company being sold, Parker said, “I can’t right now see any significant disadvantage to it.”
Additionally, it could signal to China that Australia is serious about relations with regional partners.
Leaving the door ajar, Austal said it “is open to further engagement if Hanwha is able to provide certainty on whether a transaction would be approved.” (Source: Defense News)
05 Apr 24. Adelaide tech company to set up in US after $4m funding boost.
Listed tech firm AML3D will establish a manufacturing hub in Ohio using the proceeds from a multi-million-dollar capital raise.
The company, which has developed a 3D printer that uses metal, will establish its US headquarters at the Ohio facility to position itself to “rapidly scale up its US employee base to meet the strong and growing demand in the US for advanced manufacturing technology solutions”.
The Ohio facility – which will be led by recently appointed President of US Operations Pete Goumas – will build AML3D’s advanced manufacturing systems and house the company’s US sales and operating functions.
The move follows a series of big moves from AML3D, including securing $11.9m of US Defence contracts in 2023.
AML3D managing director Sean Ebert said the company is noticing “surging demand in the US for [its] technology”.
The plans are backed by a $3.9m raise at 5 cents per share, which will see about 78 m new shares issued.
“The completion of this capital raising will provide the funds to establish a US manufacturing and US national sales team in Ohio to ensure we can take full advantage of this surging demand,” said Ebert.
“Our Ohio-based facility will offer greater support to the US Defence sector, ensure we are best positioned to continue to win US Defence contracts and have a springboard from which to enter the additional US manufacturing sectors we have targeted, including Marine, Oil & Gas and Aerospace.”
About $500,000 of the total funds raised will be invested in the AML3D’s software and technology to “maintain the company’s competitive advantage”.
This will include increasing the applications of its 3D printing solutions in support of the US Defence sector, and expanding its software development expertise.
“Our success to date has been built around AML3D’s market-leading Wire-Arc Additive Manufacturing solutions meeting the needs of the US Defence sector, particularly the US Navy’s submarine and industrial base,” Ebert said.
“The continued investment in our technology is designed to maintain that competitive advantage, to drive growth and create long-term value for our existing and new shareholders.”
The news comes after AML3D announced it had achieved AS9100D accreditation, meaning it can now design, develop and manufacture aviation, space and defence products.
“Having the ambition to target and then achieve AS9100D accreditation is a significant milestone for AML3D and is a great credit to the talent, expertise and dedication of our people,” Ebert said.
“It demonstrates our ability to deliver quality components into the aviation, space and defence sectors; enhances our credibility and reputation as a leading provider of advanced additive manufacturing solutions and positions AML3D as a highly competitive player in the Aerospace market.” (Source: Google/https://en.yna.co.kr/)
05 Apr 24. Japan space startup Astroscale aims for June listing. Space junk removal startup Astroscale is targeting a Tokyo listing as early as June, sources said, taking the high-profile venture public in a sector with out-of-this-world prospects and down-to-Earth risk.
The 11-year-old Japanese company spoke to overseas institutional investors in March to gather feedback before making a decision on a listing, said two people familiar with the matter, declining to be identified as the information is not public.
The lead managers are Mitsubishi UFJ Morgan Stanley Securities and Mizuho Securities, the people plus a third person said.
Founded by ex-government official Nobu Okada, Astroscale has won government backing in Japan, the U.S. and Britain as it develops technology to remove orbital junk such as disused satellites and spent rockets which are seen as a collision risk.
The firm considered going public last year but postponed due to factors including a mismatch over valuation, and may push it back again depending on investor feedback, one of the sources said.
Astroscale, which is also developing technology to extend the life of satellites, sees ispace (9348.T), opens new tab as one reference for a potential valuation. The moon explorer listed last year and is worth around $450 m after a recent share slide.
Astroscale did not reply to requests for comment by email and phone. Mitsubishi UFJ Morgan Stanley Securities and Mizuho Securities declined to comment.
RISK TOLERANCE
The government is fostering its space sector with backing for startups as well as industry heavyweights like Mitsubishi Heavy Industries (7011.T), opens new tab, as it works with the U.S. and competes with China.
It aims to double the size of the domestic space sector to 8 trillion yen ($53 bn) by early next decade.
In listing, Astroscale would follow in the steps of ispace as well as satellite imaging firm Institute for Q-shu Pioneers of Space (iQPS) (5595.T), opens new tab, whose share price has risen more than 700% since its December initial public offering.
“Space startups are booming and will be popular among retail investors” amid attention on space firms as governments offer backing to the sector, said analyst Kazumi Tanaka at DZH Financial Research.
However working out business forecasts for some is difficult, he said.
Though market sentiment is generally positive with the Nikkei share price average at near record highs, institutional investors look at the space sector critically due to the risk involved, one source said.
Last month’s explosion of the Kairos rocket from Japanese launch firm Space One underscored the dangers.
Tokyo-based ispace suffered failure with its Hakuto-R moon landing mission in April last year. It issued new shares last month to overseas investors and raised 8.4 bn yen, but only after halving the number of shares.
One foreign institutional investor who participated in the offering said the stock was not one to be held long term due to the unclear business outlook.
The investor has already sold the shares, they said.
“From the perspective of institutional investors entrusted with money and looking at market risk-return, ispace clearly exceeds their risk tolerance,” said one of the sources.
The price of ispace shares has fallen almost a third since the start of March and is trading below the 871 yen issue price.
“We are extremely proud of the confidence that both retail and institutional investors in Japan and around the globe have shown in ispace,” the company said in a statement, adding that it has a robust business plan with achievable goals.
A second ispace moon lander mission is scheduled to launch this year. The firm will start a NASA-sponsored moonshot in 2026. ($1 = 150.9000 yen) (Source: Reuters)
04 Apr 24. Shield AI to Acquire Australia-Based Sentient Vision Systems and Establish Shield AI Australia. Shield AI, Inc., the defense technology company building the world’s best AI pilot, has announced a definitive agreement to acquire Sentient Vision Systems (Sentient), an Australia-based leader in AI-enabled real-time situational awareness, pending customary closing conditions and regulatory approval.
Shield AI and Sentient Vision Systems will merge AI expertise and operational understanding to deliver superior intelligence surveillance and reconnaissance (ISR) capabilities for today’s rapidly changing defense and security environment.
The companies will merge AI expertise and operational understanding to deliver superior intelligence surveillance and reconnaissance (ISR) capabilities for today’s rapidly changing defense and security environment. In August 2023, the companies announced the joint development of a ViDAR-enabled wide area motion imagery (WAMI) solution called “Sentient Observer,” which Shield AI plans to fly this year.
“The combination of AI pilots, Sentient Observer, and teams of affordable drones like the MQ-35 VBAT will provide the same land and maritime domain awareness that today’s $40m and $180m Group 5 drones and crewed aircraft like the P-8 provide at a fraction of the price. The DoD has asked for an all-seeing eye over tens of thousands of square miles, 24/7, without the need for GPS or communication links. For Shield AI, Sentient Observer is the final piece of that puzzle. The DoD can begin augmenting and replacing their legacy solutions for a distributed, low cost, low risk solution that doesn’t break the bank if an aircraft is shot down,” said Brandon Tseng, Shield AI’s President, Cofounder, and former Navy SEAL.
“This acquisition unites Sentient’s ViDAR and our Hivemind AI pilot, creating the world’s most advanced AI-piloted ISR sensor package,” said Ryan Tseng, CEO and Cofounder of Shield AI. “Considering the imperative of covering vast maritime areas, especially in the Pacific, joining forces with Sentient was a strategic choice given their expertise in optical radar solutions. The integration of WAMI on V-BAT will revolutionize our offering, enabling Group 3-sized aircraft to perform tasks that previously required larger, costlier aircraft, significantly enhancing our customers’ operational capabilities.”
This news follows several significant milestones for Shield AI’s growth in the Australian market. In February, V-BAT received certification for Australian operations from Australia’s Civil Aviation Safety Authority (CASA). Shortly thereafter, in partnership with Shield AI’s Australian partner, Toll Aviation, the companies launched the inaugural Australian V-BAT training course.
“What stood out to us about Shield AI is that they are the only company in the world with an operational AI pilot, and therefore have the technological expertise and maturity to really deliver on the AI technology workstream underlined in AUKUS Pillar 2. The innovation breakthrough combining our computer vision AI-enabled ViDAR and Shield AI’s Hivemind will increase situational awareness, enabling quicker more effective decision making and help to save lives,” said Sentient’s CEO, Mark Palmer.
ViDAR is Sentient’s AI system, which uses an Electro-Optic or Infrared (EO/IR) sensor to detect and classify targets in the imagery stream that would be invisible to a human operator or to a conventional radar. Shield AI’s flagship product, Hivemind, is an AI pilot that enables teams of intelligent aircraft to operate and complete missions autonomously in high-threat environments, without the need for remote operators or GPS. Hivemind is an aircraft-agnostic autonomy stack similar to the self-driving technology found in cars. It has flown six aircraft, including quadcopters, the MQ-35A V-BAT, the F-16, and Kratos MQM-178 Firejet. Later this year, it will fly Kratos’ XQ-58 Valkyrie. Shield AI has accumulated more autonomous flight hours executing fighter jet maneuvers, like dogfighting, than any company in the world.
About Shield AI
Founded in 2015, Shield AI is a venture-backed defense technology company whose mission is to protect service members and civilians with intelligent systems. In pursuit of this mission, Shield AI is building the world’s best AI pilot. Its AI pilot, Hivemind, has flown jets (F-16; MQM-178 Firejet), a vertical takeoff and landing drone (MQ-35 V-BAT), and three quadcopters (Nova, Nova 2, iPRD). The company has offices in San Diego, Dallas, Washington, D.C., and abroad. Shield AI’s products and people are currently in the field actively supporting operations with the U.S. Department of Defense and U.S. allies. For more information, visit www.shield.ai. Follow Shield AI on LinkedIn, X, and Instagram.
About Sentient Vision Systems
Sentient Vision Systems specializes in passive, optical detection using wide area motion imagery. Sentient’s Artificial Intelligence (AI)-enabled sensor edge solutions better detect and identify small objects, on land, in the air and at sea. With more than 20 years of development in moving target indication, AI computer vision and machine learning, Sentient has deployed thousands of systems worldwide in the field of Intelligence, Surveillance, Search and Rescue, enhancing situational awareness decisions in real-time and helped saved lives. (Source: PR Newswire)
03 Apr 24. Airbus Ventures announces its investment in OROS Labs, an innovative thermal solutions company, which has raised $22m to support the company’s expansion in consumer, commercial, and government industries. This round of funding was led by Airbus Ventures, with participation from REI Co-op Path Ahead Ventures, Platinum Mile Ventures, Culper Ventures, Crumpton Ventures, Iron Gate Capital Advisors, Enlightenment Capital, CTK and the Goldwin Play Earth Fund, among others.
Solarcore® leverages the thermal properties of polymer aerogel, the world’s lowest thermally conductive solid, to revolutionize insulation for a multitude of applications – from structures and packaging to cold weather apparel. For aerospace and space in particular, thermal insulation materials and thermal management are operationally critical. By combining cutting-edge technology with innovative design, Solarcore® is setting a new standard for thermal efficiency, along with being durable, versatile and applicable to many different product categories.
“From our earliest exchanges with Michael and Rithvik, we were instantly attracted by OROS Labs’ potential to serve a wide array of dual-use applications. With the flexible design of its thermal product suite, Solarcore® represents the most versatile aerogel materials ever made,” remarks Nicole Conner, Airbus Ventures Partner. “We are proud to lead OROS Labs’ Series B round, and to bring the OROS Labs team into the Airbus Ventures portfolio.”
“The support from our investors in this Series B funding round strongly reflects our ambition to reinvent a field that has seen limited innovation,” said Michael Markesbery, co-founder and CEO at OROS Labs. “This investment opens doors for us to pursue strategic partnerships, bolster our manufacturing capabilities, scale our product offerings, and advance our research and development efforts to continue introducing groundbreaking materials to the market.”
“The confidence of our new investors, dedicated to strengthening our networks within the aerospace, defense and heavy industry verticals broadly, will help equip us with the expertise necessary to revolutionize the once stagnant thermal insulation category,” added Rithvik Venna, co-founder and COO at OROS Labs. “Bringing along our partners for this next phase of our strategic growth will be critical in advancing our team, products, and results.”
Solarcore® continues market expansion through key strategic partnerships with the U.S. Department of Defense and renowned consumer footwear brands, such as Merrell and L.L. Bean, showcasing the advantages of its technology across government and consumer industries. One example includes its new collaboration with the U.S. Department of Defense, where Solarcore® is set to transform the Army’s cold weather tactical shelters, offering enhanced heat retention, reduced weight, and improved efficiencies in transportation and setup. With the Defense Department investing bns annually in heating and cooling tactical shelters, the adoption of Solarcore® presents significant cost-saving opportunities, and operational and carbon footprint benefits.
Additionally, OROS Labs has recruited an incredible team of advisors and leadership, including Jim Ryan, former CEO and Chairman of WW Grainger; Mike Brown, former CEO of the Defense Innovative Unit; Happ Klopp, founder of The North Face; Hank Crumpton, CEO of Crumpton Global LLC and former head of the CIA’s National Resource Division; Rodney Faraon, Partner and Chief Creative Officer at Crumpton Global LLC; and Jeff Jordan, general partner at Andressen Horowitz.
Solarcore® has built an impressive leadership team, with deep experience in materials, innovation, business development and marketing from industry leading companies, including Teledyne FLIR, The North Face, icebreaker, Columbia Sportswear, Adidas, and more.
About OROS Labs®
OROS Labs is a materials technology company developing the most advanced thermal insulation on the planet. We took NASA’s well known Aerogel technology and patented ways to infuse into products that deliver best-in-class thermal efficiency.
About Airbus Ventures
Headquartered in Silicon Valley, with offices in Toulouse and Tokyo, Airbus Ventures is a fast-moving, early-stage venture capital company that independently funds and supports startups set to shift both the aerospace industry and our planetary system to a sustainable future. Airbus Ventures has helped aspiring innovators reach new dimensions of achievement since 2015. (Source: BUSINESS WIRE)
03 Apr 24. All smoke, no fire: Hanwha buyout of Austal appears dead in the water. West Australia-based naval and commercial shipbuilder Austal has poured cold water on an indicative offer by South Korean industrial powerhouse Hanwha Group to acquire its global business. The deal, subject to the appropriate due diligence and Foreign Investment Review Board (FIRB) approvals, was rejected by Austal in an official statement on 2 April.
“Hanwha’s indicative proposal is subject to numerous conditions, including due diligence, various regulatory approvals including Australia’s Foreign Investment Review Board (FIRB), the Committee on Foreign Investment in the United States (CFIUS) and the US Defense Counterintelligence and Security Agency, final approval of the Hanwha Board, the unanimous recommendation of the Austal Board and Austal shareholder approval,” Austal said in a statement on 2 April.
“The Austal Board, together with its advisers, has considered the indicative proposal in detail and engaged with Hanwha in relation to whether the transaction described in the indicative proposal would obtain the relevant regulatory approvals in Australia and the USA to enable it to proceed.
“At present, Austal is not satisfied that these mandatory approvals would be secured, however, the company is open to further engagement if Hanwha is able to provide certainty on whether a transaction would be approved.”
In addition, Austal raised concerns that the company’s position as the designer and builder of defence vessels for Australian and US navies under defence contracts would limit the prospect of approval.
In particular, it outlined the recent announcement by the Australian government on 23 November 2023 that Austal and the Department of Defence had executed a memorandum of understanding to negotiate a Strategic Shipbuilding Agreement, under which Austal would be appointed as the Commonwealth’s strategic partner for vessels to be constructed in Western Australia.
David Kim, executive vice-president at Hanwha, said the company is respectful of the FIRB regulatory approval process and is confident in its ability to obtain FIRB approval for the transaction.
Hanwha stated that a recent media report, which stated concerns that the Australian government would not grant permission of the sale of Austal because it carries out defence contracting work for the Australian government, is baseless.
Matt Thistlethwaite, Assistant Minister for Defence, Assistant Minister for Veterans’ Affairs and Assistant Minister for the Republic, speaking to ABC’s Afternoon Briefing on 2 April, said ministers had been issued advice regarding the possible sale.
“I have taken some advice on this, and the advice is that we shouldn’t be commenting on it at this stage,” he said.
“A potential transaction between two corporations, and it’s not appropriate for me to comment on that at this stage.
“I will say that Austal is an Australian-based company that produces very, very high quality and reliable military hardware, and indeed, domestic shipping as well.
“I think that it’s a testament to the skill and competence that we have here in Australia. Austal produced the Admiral Class and Cape Class patrol vessels for Australia.
“They’ve produced the littoral combat vessels for the United States military. And I think it’s a classic example of why we have every confidence in Australian industry being able to deliver on the government’s very ambitious surface fleet combat program and, of course, AUKUS into the future.
“Of course, we want to make sure that we maintain sovereign capability here in Australia in all facets of military design and delivery of important projects and hardware into the future. And that’s simply not confined to this particular company. That’s something that we hope is a characteristic of Australian defence and industry moving forward.” (Source: Defence Connect)
03 Apr 24. Pensacola-based Paradigm Parachute & Defense announced its successful acquisition of ASR-Pioneer assets on 3 April 2024. The USD 2.25m (EUR 2.08m) acquisition includes all assets from Airlift Technologies International, Strong Enterprises, and ASR-Pioneer’s Mississippi-based operation. The acquisition totalled three quarters of all assets of ASR-Pioneer.
“This is an exciting time of innovation and growth for Paradigm Parachute & Defense,” Paradigm co-CEO Aaron Nazaruk was quoted as saying in a company press release. “The combined expertise of our four companies allows us to enhance our product range with an expanded portfolio of state-of-the-art defence technologies and personnel and cargo parachute systems, while also driving innovation through shared research and development efforts.”
The strategic acquisition positions Paradigm Parachute & Defense at the forefront of the defence and aerospace parachute industry. Airlift Technologies International is known as the only full original equipment manufacturer globally for the Type V Airdrop Platform System, which is a standard in heavy-duty airdrop platforms used in low-velocity airdrops worldwide. The company holds contracts with the US government that include an indefinite-delivery contract from the Army Materiel Command’s Army Sustainment Command.
Strong Enterprises, meanwhile, is described by Paradigm as “a cornerstone of the personnel and military parachute and safety equipment industry [that] brings a wealth of expertise and technology to the fast-growing Paradigm organisation”.
“We are thrilled to welcome these legacy companies with a history of high-quality, proven systems and cutting-edge innovation to the Paradigm family,” said Paradigm co-CEO Alexander Alvarado. “Our combined teams will expand our support of both legacy and next-generation parachute system development, leading to advanced solutions in aerospace safety and defence.” (Source: Google/ESD)
02 Apr 24. Australia’s Austal rejects Hanwha takeover bid over approval concerns. The shipbuilder cited its defence contracts in the US and Australia as a point of concern regarding regulatory approval of the proposed acquisition.
Australian shipbuilding and marine technology company Austal has rejected a takeover bid by South Korea’s Hanwha Ocean, citing uncertainty over the approvals of Australian and US regulatory bodies of the acquisition.
Austal confirmed receipt of the “unsolicited” bid, worth A$1.02bn ($662m), after reports in the media but said that it was particularly concerned about gaining approvals relating to its role as a partner to the Australian and US navies.
The company particularly noted a recently signed memorandum of understanding (MOU) with the Australian Department of Defence relating to a Strategic Shipbuilding Agreement that highlighted a desire to keep naval shipbuilding in the country.
A statement from Hanwha said: “Austal is a national asset and thus can only be sold to companies within the AUKUS alliance countries (US-UK-Australia).
“But South Korea maintains a close military cooperation relationship with the U.S. and Australia, including conducting numerous joint exercises, as it is an important ally of both countries.”
Despite the Austal board’s initial rejection of Hanwha’s bid, the company also said that it was open to further engagement with the South Korean manufacturer on the idea, if it was able to provide stronger certainty that the acquisition would be approved.
David Kim, executive vice president at Hanwha said the firm was confident it would gain approval.
“There is no foundation of the claim that the Foreign Investment Review Board (FIRB) would reject Hanwha’s acquisition of the company,” he said.
“Hanwha has already obtained FIRB approval for prior investments in Australia and has a proven track record of investment in Australia’s defence industrial base, being the contracted supplier of infantry fighting vehicles, self-propelled howitzers and ammunition resupply vehicles with significant investment in a Geelong manufacturing facility that employs local workers,” Kim added.
However, a regulatory filing by Hanwha revealed that no further discussions were currently underway despite efforts to engage with the board and Austal’s management.
The takeover bid comes son after Austal began preparing to also enter the UK market, signing an MOU with Harland & Wolff to pursue shipbuilding opportunities in the country such as the Border Force vessel replacement programme. (Source: naval-technology.com)
02 Apr 24. Terran Orbital Corporation (NYSE: LLAP) (“Terran Orbital” or the “Company”), a leading manufacturer of satellite products primarily serving the aerospace and defense industries, today announced that it received a notice from the New York Stock Exchange (the “NYSE”) on March 29, 2024 stating that the Company has regained compliance with the minimum stock price continued listing standard set forth in Section 802.01C and will be removed from the NYSE’s noncompliant issuers list. The Company previously received a noncompliance notice from the NYSE because the average closing price of the Company’s common stock was less than $1.00 per share over a consecutive 30 trading-day period ended October 18, 2023. On March 28, 2024, the Company’s common stock closed above $1.00 and had an average closing share price of at least $1.00 over the prior 30 trading-day period.
02 Apr 24. Curtiss-Wright Corporation (NYSE: CW) today announced that it has completed the acquisition of WSC, Inc. for approximately $34m in cash. WSC is a leading provider of state-of-the-art simulation technology that supports the design, commissioning, and reliable operation of commercial nuclear power generation and process plants worldwide with an installed base of over 225 plant simulators. WSC generated sales of approximately $15m in 2023 and is expected to be accretive to Curtiss-Wright’s adjusted diluted earnings per share in its first full year of ownership, excluding first year purchase accounting costs, and produce a strong free cash flow conversion rate in excess of 100%. The acquired business will operate within Curtiss-Wright’s Naval & Power segment.
“The acquisition of WSC increases the breadth of Curtiss-Wright’s portfolio of advanced commercial nuclear technologies utilized in the modernization of existing power plants and design of new power plants such as Advanced Small Modular Reactors,” said Lynn M. Bamford, Chair and Chief Executive Officer. “The combination of WSC’s solutions, including their simulation and digital twin capabilities, with Curtiss-Wright’s digital safety systems and advanced condition monitoring technology, will benefit our customers developing advanced reactors as well as those optimizing any power or process plant designs. The acquisition also supports Curtiss-Wright’s financial objectives for long-term profitable growth and strong free cash flow generation.”
WSC’s proprietary 3KEYMASTER™ simulation platform is used in their nuclear full scope simulators that are mandated by the Nuclear Regulatory Commission (NRC) and remain integral to reactor operator training and licensing. Simulation assisted engineering tools optimize the design and commissioning of plants, to include Advanced Small Modular Reactors (ASMRs), by creating a digital twin of plant components and systems to reduce risk, accelerate delivery, and improve quality at a lower cost. In 2023, WSC was awarded a contract by TerraPower to support the design and development of the Natrium sodium fast reactor, and continues to contribute to the development of other leading ASMR platforms. In addition, generic simulators are used at universities, regulatory agencies, training centers and plants to offer classroom-based training on the operation of nuclear plants under normal and abnormal conditions. WSC’s simulation capabilities have also proven beneficial for U.S. Navy nuclear design agencies and shipyards to enhance the design process of nuclear systems and components for aircraft carriers and submarines. WSC, which was founded in 1995 and employs approximately 45 people, maintains operations in Frederick, MD.
03 Apr 24. HENSOLDT completes acquisition of ESG. Major growth opportunities for national champion in defence electronics. Sensor solutions provider HENSOLDT has completed the acquisition of ESG Elektroniksystem- und Logistik-GmbH, which was agreed last year, with effect from 2 April 2024 after receiving all official approvals. ESG is a leading platform- and manufacturer-independent system integrator as well as an established technology and innovation partner for defence and security. The acquisition adds strong design and system integration capabilities to HENSOLDT’s product and solutions business and creates a national champion in defence electronics.
HENSOLDT CEO Oliver Dörre emphasises: “The acquisition of ESG fits perfectly into our overall strategy and accelerates the development of HENSOLDT as a solution provider for defence and security. By combining the highly complementary capabilities of HENSOLDT and ESG, we are taking a decisive step towards becoming a leading European provider of seamlessly integrated solutions. This step accelerates our international growth and opens up excellent development opportunities for ESG through capital market access.”
Christoph Otten, Managing Director of ESG, also emphasises the many opportunities: “The deal gives ESG the backing of a financially strong listed company and access to international markets. As part of complete solutions, we can develop our excellent capabilities as a system integrator, technology and innovation partner even better.”
Founded in 1967, ESG is a manufacturer-independent system integrator and technology and innovation partner for defence and public safety. The company develops, integrates, supports and operates highly complex, security-relevant electronic and IT systems in the fields of defence and security. ESG has established itself as a leading German systems house and plays a key role in important current and future programmes such as FCAS (Future Combat Air System) and the F-35. The company employs around 1,400 people in Germany, the Netherlands and the USA and generated sales of around 330m euros in 2023.
02 Apr 24. Firestorm Labs, a California-based drone manufacturer heavily leveraging 3D printing technology, has raised $12.5m in seed investment led by Lockheed Martin Ventures and prominent defense investors – including Decisive Point, Silent Ventures, 645 Ventures, Overmatch VC, BVVC, Marquee Ventures, Cubit Capital, IronGate, Backswing Ventures, The Veteran Fund, Feld Ventures, Beyond Capital, and RedCat.
“Firestorm is excited to announce this latest round of funding that will propel the company forward to shape the rapidly evolving needs of a UAS-dominated battlefield and a defense industrial base ripe for revolutionary manufacturing models,” said Dan Magy, CEO of Firestorm Labs. “Our investors understand the pressing need for delivering technologies quickly and with the interoperability that today’s warfighters demand, and we are thrilled to welcome Lockheed Martin Ventures partnership in this mission.”
Bringing best-in-class engineering capabilities from the commercial advanced manufacturing space, Firestorm’s xCell line allows for its proprietary, 3D printed, interconnected, and interchangeable airframe component technology to be manufactured at the edge – an approach that will fundamentally change the nature of warfare.
“We are a new approach to an emerging global challenge,” said Chad McCoy, Co-Founder and Chief Strategy Officer of Firestorm Labs. “There is a clear need within the defense technology sector to build faster and less costly systems, and simply throwing money at the issue won’t change the outcome. We found that coalescing a deep operational understanding of warfighter needs, combined with aerospace pragmatism, and a new rapid manufacturing model, allows us to stand out in a very crowded market. The goal is to create a completely new category that shakes up legacy timelines and cost.”
Firestorm has already won a range of US Department of Defense contracts, both for its modular drones and the xCell manufacturing product line. This new capital will enable Firestorm to scale its team and production to meet growing demands for its products. (Source: Google/https://www.voxelmatters.com/)
02 Apr 24. DefendTex enters discussions to acquire Brazil’s Avibras. DefendTex has announced that it has entered into negotiations with Brazil’s Avibras Indústria Aeroespacial for a potential acquisition, enabling the economic and financial recovery of the Brazilian technology provider.
It is hoped that the acquisition will ensure that the company can maintain its manufacturing facilities in Brazil and resume operations as soon as possible, the companies outlined in a recent statement.
Avibras has supported clients in the aerospace, defence, electronics, vehicles, and aeronautical sectors for over 60 years.
Local Australian company DefendTex delivers capabilities spanning guided weapons, energetics, rocket manufacturing, and loitering munitions.
“Avibras Indústria Aeroespacial and DefendTex hereby announce that they have been engaged in advanced discussions to facilitate a potential investment aimed at the economic and financial recovery of Avibras, with the goal of maintaining its manufacturing facilities in Brazil, resuming operations as soon as possible, and ensuring the fulfilment of contractual obligations with the Brazilian government and other clients,” the companies said in a statement.
“Both companies are committed and diligently working to finalise the specific terms and conditions of the investment and will keep the market informed.”
In 2023, the Brazilian government confirmed that it was deploying troops to the Venezuelan border, as Venezuela announced that it would look to invade neighbouring Guyana.
The threats emerged as 95 per cent of Venezuelan voters supported the government’s claim to Guyana’s Essequibo region. (Source: Defence Connect)
02 Apr 24. Investors hope GE spinoff will defy poor track record of breakups. As General Electric (GE.N), opens new tab completes its $191.9bn breakup, bullish investors are betting it will defy the lacklustre share price performance that has followed many corporate spinoffs over the last few decades.
Shares of GE were up nearly 37% this year as of Monday and stood near a seven-year high.
On Tuesday, the company’s energy spinoff – whose businesses include wind turbine production and powering data centers – began trading under the name of GE Vernova (GEV.N), opens new tab. GE Aerospace, which makes engines for commercial and military aircraft, kept the GE ticker symbol. Investors who held GE as of March 19 received one share of GE Vernova for every four shares of GE they owned.
Shares in Vernova were up around 3.8% on Tuesday, while GE’s shares were up 1.2%.
While spinoffs are typically designed to unlock value, many have been followed by unremarkable share price performance. A Bain & Co study of more than 350 spinoffs between 2000 and 2020 showed that spinoffs generated an average total investor return – defined as equity appreciation plus dividend yields – of 5.1% a year over the three years after the split. That compares to an average annual 8.7% total return for the S&P 500 during the same time frame.
“You don’t get multiple expansion for free in this type of transaction, you have to earn it,” said Jeff Haxer, a partner at Bain who led the study.
Spinoffs underperformed in the three-year timeframe for a broad range of reasons, including a loss of synergies that had helped the parent company control costs or maintain margins, Haxer said. The firm looked at spinoffs that created companies with a market value of more than $1 bn, including Baxter’s spinoff of its Baxalta biopharma business and Kraft’s spinoff of its snack business into Mondelez International (MDLZ.O), opens new tab.
Whether GE’s latest spinoff will meet a similar fate remains to be seen. GE in 2021 said it would split into three companies focused on aerospace, healthcare and energy, part of CEO Larry Culp’s plan to unlock value and make capital allocation more transparent to investors.
Its healthcare business, GE HealthCare Technologies (GEHC.O), opens new tab, was spun off in January 2023 and has so far bucked the broader trend. The company’s shares are up nearly 50% since it broke off, while the parent company’s shares have risen almost 170%.
Some investors are betting the company’s latest spinoff will see similar success.
Jason Adams, portfolio manager of the T Rowe Price Global Industrials Fund, said GE’s aviation business puts it in the top tier of global industrial companies.
GE Aerospace has been a cash cow for the Boston-based company, with some analysts estimating its market value at more than $100 bn after the spinoff.
At the same time, the new GE Vernova could see growth due to the increasing consumption needs of data centers that will power generative artificial intelligence, Adams said.
“Aerospace was a better known entity and its growth outlook better understood, but I think Vernova has been more recently discovered by the investment community and that’s what has been behind the pop in (GE’s) the stock this year,” said Adams, who plans to be a shareholder in both companies.
Vernova last month said it expects to clear a massive backlog in offshore wind equipment over the next two years, signaling improved market conditions for the beleaguered sector, which has faced hefty writedowns as soaring inflation, interest rate hikes and supply chain issues increased project costs.
Larry Tentarelli, chief technical strategist at Blue Chip Daily Trend Report, said the remainder of GE is now a better pure play on aviation. He expects its multiples to improve from a current 22 times trailing earnings as investors get a clearer look at its earnings growth and balance sheet, separate from GE’s power business.
“The aviation business is humming along on all cylinders,” said Tentarelli, who owns GE and plans on holding onto his Vernova shares.
Whether the deal becomes a net positive for investors will likely hinge on the growth of the renewable business for GE Vernova, said Chris Snyder, an analyst at UBS. He has a buy rating on both companies, with a target price of $154 for GE and $37 for GE Vernova.
Of the analysts covering GE, 13 now have a buy or strong buy and 5 have a hold, according to LSEG.
“GE is taking share and has pricing power,” Snyder said, while the rising demand for energy due to AI data centers is making him “increasingly positive on the prospects for GE Vernova.” (Source: Reuters)
02 Apr 24. General Electric completes spin off of aviation engines business, launching GE Aerospace. The breakup of General Electric into three new companies signifies a new age for one of the two major US aviation engine manufacturers. American industrial behemoth General Electric today completed the spin off of its aviation and energy businesses, launching GE Aerospace as a standalone company. The event is the final step in the long-awaited break up of General Electric into three individual companies, first announced in 2021, and signifies a new age for one of the two major US aviation engine manufacturers, with its defense engines unit making up about $9 bn of GE Aerospace’s $32bn portfolio. GE Aerospace CEO Larry Culp, who has led General Electric since 2018, rang the opening bell on the New York Stock Exchange this morning, celebrating GE Aviation’s transition into a publicly traded company alongside the energy spinoff GE Vernova. GE Health Care launched last year.
“Building on a century of learning and carrying forth GE’s legacy of innovation, GE Aerospace moves forward with a strong balance sheet and greater focus to invent the future of flight, lift people up, and bring them home safely,” Culp said in a statement.
General Electric’s aerospace unit has remained largely steady even as the company floundered following the 2008 financial crisis, which forced the US government to bail out its GE Capital banking unit.
While commercial engines — particularly the CFM56 LEAP engine it produces with French engine maker Safran and is used in Boeing 737 MAX and Airbus A320neo narrowbody planes — will continue to make up the backbone of the company, its Defense and Propulsion Technologies unit “are very well positioned given lively defense spending trends over the next decade,” Culp said during a March investors day.
GE Aerospace produces the propulsion plants for military planes such as the F-15EX, F-16, E-7 Wedgetail and T-7 training jet, as well as helicopter engines for the UH-60 Black Hawk, AH-64 Apache and CH-53K King Stallion.
The company expects mid- to high-single digit growth for its defense unit in 2024, driven by increased engine shipments, and sees strong interest from international customers like Japan and South Korea for GE engines to power homegrown combat aircraft currently in development, executives said at the investors day.
Although the Pentagon has decided not to replace the F-35’s Pratt & Whitney-made propulsion plant with a new model, another major defense opportunity could be on the horizon as the US Air Force continues development of advanced engines for its Next Generation Air Dominance (NGAD) fighter jet.
Last summer, Air Force propulsion chief John Sneden told reporters the service plans to fund Next Generation Adaptive Propulsion (NGAP) prototypes from both GE Aerospace and Pratt & Whitney instead of cutting one competitor early in 2024. The winner of the NGAP competition will power the NGAD fighter jet.
Culp said in March that the GE Aerospace would be willing to continue to put company money into its advanced XA100 engine, thought to be the basis of its NGAP design, “if and when that’s required to progress the technology developments.” (Source: Google/Breaking Defense.com)
31 Mar 24. Thales acquires UAE-based start-up AstraUTM – further UTM company consolidation likely. “I am thrilled to announce that our startup has been acquired by Thales, a leader in aerospace, defence, transportation and security industries,” writes Asam Khan, CEO AstraUTM, in a Linkedin post. “Joining forces with Thales opens up an exciting new chapter for us. It enables us to accelerate our growth, broaden our offerings, and leverage powerful synergies to enhance our services. Thales shares our dedication to unbridled, lightening innovation, and I have the utmost confidence that this partnership will take our mission to new heights.”
Astra UTM, headquartered in Dubai, also has offices in Finland and Portugal. In October 2021 Thales announced it has signed an agreement with Fintraffic Air Navigation Services to implement the initial UTM-centric services in Finland. Astra UTM has delivered the Situational Awareness and Briefing Facility systems for Fintraffic ANS’s Digital Business Platform which is a collaborative initiative under Traffic Management Company Fintraffic Ltd.
Apart from Fintraffic, AstraUTM’s client base includes:
- The Dubai Civil Aviation Authority (DCAA), who chose AstraUTM as the primary metropolitan drone registration, tracking and alerting system.
- ENAV S.p.A – Italy; the AstraUTM platform was used as a Beyond Visual Line of Sight (BVLOS) solution, and included pilot and drone registration, centralized flight applications and evaluation, live flight tracking and monitoring.
- The Directorate General of Civil Aviation (DGCA) and Airports Authority of India (AAI) – India has established the project for conducting experimental BVLOS operations of drones in India, and AstraUTM is one of the final seven consortiums selected as participants.
- Deployed in a 425km corridor in the remote wilderness of Northern Alberta, Airmarket is using AstraUTM to facilitate trials in the oil and gas industry, in conjunction with the Petroleum Technology Alliance of Canada (PTAC), as well as one of North America’s leading energy infrastructure companies, by providing drone based Sensing Data Services.
- During Expo2020 Dubai implemented AstraUTM for the entire six month duration of the event, and tasked the AstraUTM team with the responsibilities of drone traffic management as well as managing all low level airspace activities on site, such as fireworks, drone light shows, skydiving, hot-air balloons, falconry, kites, and light shows.
- The AstraUTM solution is a key component of drone delivery trials that are being conducted by Aerocivil Colombia in the city of La Ceja, Colombia.
“Interesting move,” said Philip Butterworth-Hayes, editorial director of Unmanned Airspace. “Thales is a major integrator with its own UTM offering, which comes with a major-integrator price tag. In developing its strategy of offering ATM and UTM-as-a-service to air navigation service providers worldwide, it needs a software-based, agile provider of services which is exactly what Astra-UTM is. I would expect to see the other major integrators – including Leonardo and Indra – make similar moves. We are still in the pre-commercialisation phase of UTM and the business case for providing services rather than infrastructure remains elusive. It will be much easier for the majors to partner with start-ups than downsize their own offerings.” For more information: https://www.linkedin.com/feed/update/urn:li:activity:7180080433324318720/
(Source: www.unmannedairspace.info)
01 Apr 24. RTX cyber and intel business becomes Nightwing following sale. The cybersecurity and intelligence division RTX sold has now become a business known as Nightwing. Word of the standalone company comes months after RTX disclosed a $1.3bn arrangement in quarterly financial documents. An RTX spokesperson on April 1 told C4ISRNET the deal had gone through and that Nightwing was “not connected” to the defense contractor. The spokesperson did not name the buyer. Reuters previously reported it as private equity firm Blackstone. Nightwing’s leadership features RTX alumni, including John DeSimone, Steve Worley, Timothy Zentz, Jon Check, Lori Scherer and Ron McDermott. The company bills itself as “40 years in the making.”
“Nightwing may be a new name, but we’re no amateurs,” its website reads. “Previously part of a leading Fortune 100 company, we became independent in 2024.”
RTX is the second-largest defense contractor in the world when ranked by defense-related revenue. The Virginia-based company earned $39.6bn in defense revenue in 2022 and $41.9bn in 2021, according to the Defense News Top 100 list. (Source: C4ISR & Networks)
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SPX CommTech, part of SPX Technologies Inc, innovates specialised technologies within the Radio Frequency (RF) spectrum to ensure a smarter, more secure future for all. Formed by TCI and ECS, SPX CommTech’s Battlespace portfolio enables defence and security teams to detect, defeat and exploit RF signals to enhance communications intelligence (COMINT) and counter unmanned aerial systems (Counter-UAS). Additionally, its Tactical Data Link portfolio allows intelligence gathering agencies, special forces, emergency response, and security teams to securely and reliably transfer video and data between enabled-aircraft and ground teams over long distances for airborne Intelligence, Surveillance, Reconnaissance (ISR). For more information visit www.tcibr.com and www.enterprisecontrol.co.uk
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