Leonardo DRS buys Israeli radar co RADA at 34% premium
Table of Contents
Netanya-based mostly Israeli defense company RADA Digital Industries Ltd. (TASE: RADA Nasdaq: RADA), which produces tactical radar programs, is merging with US corporation Leonardo DRS Inc. The stock-based mostly transaction will result in RADA’s present shareholders keeping 19.5% of the merged business. The deal is envisioned to near in the fourth quarter of this yr. RADA will become a wholly-owned subsidiary of Leonardo DRS, which will be mentioned on Nasdaq and on the Tel Aviv Inventory Exchange beneath the image DRS. The phrases of the offer stand for a 34% premium around RADA’s closing share selling price yesterday, valuing the enterprise at $775 million.

The blended enterprise is predicted to make EBITDA as a share of profits in the very low double-digits in 2023. The mixed business had $2.7 billion income and $305 million modified EBITDA in 2021. At the conclude of the to start with quarter of 2022, the merged firm experienced financial debt of around $197 million.

RADA is a veteran company that for most of its existence dealt in avionics. More than a decade ago, it entered a new field, that of advanced application-defined armed service tactical radars. The radars are mounted on navy vehicles and work on the shift. They so deliver ground forces with lively defense, these kinds of as against mortars and attack drones. The enterprise is also nevertheless lively in its standard field of avionics.

“RADA and Leonardo DRS are strong and complementary engineering corporations, and their near historic marriage as a result of collaboration on various plans, has resulted in a deep cultural healthy,” the companies’ announcement explained.

The announcement also stated that “Leonardo DRS’s mother or father corporation and sole shareholder, Leonardo SpA, is a foremost international Aerospace and Protection organization. Leonardo SpA’s industry place will supply entry to a reshaped European defense industry as perfectly as protection marketplaces about the earth, whilst also establishing a home industry in Israel.”

RADA CEO Dov Sella explained, “I could not be prouder of the system we have constructed through my practically 20 yrs with RADA, culminating in this significant strategic transaction with Leonardo DRS. The mix of two major technology-concentrated defense providers with diversified publicity to crucial US Office of Protection plans and an international existence generates a accurate gain-win for RADA and Leonardo DRS shareholders.

“The transaction represents the 1st time a important US-dependent defense corporation backed by a world wide protection prime has acquired a sizeable Israeli defense technological innovation corporation. This exclusive transaction will improve the Israeli protection field and established trends and way for the potential.”




Associated Content articles




5 Israeli tech cos surviving the Nasdaq carnage



Israeli defense electronics co RADA could be up for sale



Israeli 4D imaging radar co Vayyar raises $108m







“The conflict in Ukraine has underscored the vulnerability of forces to drone attacks and has highlighted the have to have for present day, capable power defense units. Not only is this accelerating US buys of these systems, but it is transferring European countries, which are substantially driving in this place, to purchase a lot more critical power safety property. The combination of RADA and Leonardo DRS will open global sector prospects, specifically in brief-variety air defense, counter-UAS, counter rockets, artillery and mortars and motor vehicle protection devices,” mentioned William J. Lynn III, CEO of Leonardo DRS.

Evercore is serving as special monetary advisor to RADA and J.P. Morgan Securities LLC is serving as distinctive economical advisor to Leonardo DRS. DLA Piper LLP (US) and S. Friedman & Co. are serving as legal advisors to RADA and Sullivan & Cromwell LLP and Herzog Fox & Neeman are serving as legal advisors to Leonardo DRS.

Revealed by Globes, Israel small business news – en.globes.co.il – on June 21, 2022.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2022.


