Aeronautics mulls buying US defense co for $6m

Aeronautics Orbiter

The acquisition would allow the Israeli unmanned defense systems developer to undertake orders using US military aid.

Israeli unmanned defense systems developer Aeronautics Ltd. (TASE:ARCS), which held its IPO last month, has notified the Tel Aviv Stock Exchange (TASE) that it is set to buy a US defense company for $6 million. Aeronautics is currently conducting talks and checking the company and if all goes according to plan the Yavne-based UAV company will complete the deal by the end of September.

Acquiring a US company will provide Aeronautics with a platform to consolidate its operations in the US and allow it to undertake orders paid for US military aid, as do other Israeli defense companies such as Elbit Systems Ltd. (Nasdaq: ESLT; TASE: ESLT).

Aeronautics shares began trading on the TASE three weeks ago after the company's controlling shareholders, the Bereshit and KCPS funds, sold nearly half of their holdings in the company at a company value of NIS 1 billion. Aeronautics itself raised a further NIS 53 million by issuing new shares to Leumi Partners Ltd.. Since the IPO, Aeronautics share price has risen 2%.

Founded in 1997, the Aeronautics group provides intelligence solutions based on UAV systems with a variety of UAVs having diverse configurations and capabilities, electro-optical systems, sensor and communications systems, observatory balloons, and drones.

Aeronautics has a number of subsidiaries: RT (observatory balloons), PoziDrone (drones), Controp (observation systems, lenses, and electro-optics), Commtact (communications and encryption solutions), and Zanzottera (UAV engines). Aeronautics also manufactures UAVs, and the subsidiaries make components and supplementary products for its business, so that the entire supply chain is within the group, with no dependence on external parties.

Aeronautics's reports show that 35% of its $137 million revenue last year came from Europe, 30% from Asia, 18% from Israel, 10% from the US, and 7% from Africa. The company has 660 employees and 70 customers in 52 countries. Two of the customers are very important, with one accounting for 20% of Aeronautics's revenue last year and the second for 13%.

Published by Globes [online], Israel business news - - on July 17, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

Aeronautics Orbiter
Aeronautics Orbiter
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