Unmanned aerial systems (UAS) manufacturer AeroVironment is buying Arcturus UAV, a privately-held provider of Group 2 and 3 unmanned aircraft systems (UAS), for a total purchase price of $405 million.
The agreement outlines a transaction involving $355 million in cash and $50 million in AeroVironment stock.
With the acquisition, Aerovironment is looking to accelerate its strategy to drive profitable growth and value by expanding into attractive adjacent segments and by broadening its capabilities and customer footprint.
Founded in 2004 and based in Petaluma, California, Arcturus UAV has approximately 270 employees, designs and manufactures Group 2 and Group 3 UAS (systems with maximum takeoff weights between 10 and 600 kilograms).
Arcturus UAV is a leading supplier to the USSOCOM, supporting its $1.4 billion MEUAS III and IV programs, and one of four awardees selected for funded development and demonstrations supporting the US Army’s FTUAS program, a potential billion dollar, next-generation UAS program.
Arcturus UAV’s products include the JUMP-20, a multi-mission, medium endurance vertical takeoff and landing (VTOL) system requiring no launch equipment or runway and the T-20, a multi-mission, medium endurance catapult-launched system. All Arcturus UAV systems have the ability to carry a broad range of payloads, including standard EO/IR gimbals as well as 3-D mapping, SAR, LIDAR, communications relay, COMINT and SIGINT payloads.
“We are excited about the opportunities for value creation through our acquisition of Arcturus UAV, which will enable us to accelerate our growth strategy and expand our reach into the more valuable Group 2 and 3 UAS segments,” said Wahid Nawabi, AeroVironment president and chief executive officer.
“Group 2 and 3 UAS and services, collectively, potentially represent more than one billion dollars in annual contract value, according to an independent forecast. Through this expanded portfolio, we will be well positioned to serve a broader range of customer missions across multiple domains and significantly enhance value for shareholders over the near and long-term.”
“We are confident that with AeroVironment, we can accelerate our growth as part of a larger, more diverse company and look forward to working closely with the team to complete this exciting transaction,” said D’Milo Hallerberg, Arcturus UAV president and chief executive officer.
The transaction is expected to close during fourth quarter of AeroVironment’s fiscal year 2021, subject to customary closing conditions and regulatory approvals. At close, Arcturus UAV will operate as a wholly-owned subsidiary of AeroVironment.