Key takeaways
- Shield AI agreed on November 5 to buy Echodyne for $5.3 billion, with up to $500 million contingent on performance.
- It is raising $2.5 billion: $1 billion Series H at $28.8 billion, $1 billion from Blackstone funds and $500 million of debt.
- Closing is expected in early 2027, subject to regulatory approvals.
Shield AI said on November 5 that it will buy radar maker Echodyne in a deal valued at $5.3 billion, and that it is raising $2.5 billion to pay for it. The company announced the Shield AI Echodyne deal in a press release.
Of the $5.3 billion, $4.8 billion is paid or issued at closing. Up to $500 million more depends on Echodyne meeting agreed performance targets. Shield expects the deal to close in early 2027, subject to regulatory approvals.
How Shield is paying
The $2.5 billion raise has three parts:
- $1 billion of Series H equity at a $28.8 billion post-money valuation, co-led by Disruptive and Innovation X Capital.
- $1 billion of structured equity from funds managed by Blackstone.
- $500 million of debt, with JPMorgan Chase Bank as sole arranger.
Shield says the proceeds will mainly fund the acquisition.
What Echodyne adds
Shield builds Hivemind, its autonomy software, and the V-BAT and X-BAT autonomous aircraft. Echodyne, based in Kirkland, Washington, makes compact solid-state radars using its own MESA technology, short for Metamaterials Electronically Scanned Array. Shield says its radars sit inside hundreds of counter-drone and security systems used in more than 40 countries.
The deal gives Shield a sensor business that detects drones, next to its work on building them. Echodyne recently opened an 86,350-square-foot factory that Shield says can make about 30,000 radars a year, and in September it received a contract with a $250 million ceiling from Joint Interagency Task Force 401.
Echodyne's team stays in place, and its radars remain on sale as standalone products. CEO Eben Frankenberg will report to Shield CEO Gary Steele.
What we don't know yet
The press release gives no revenue figures, only that both companies expect triple-digit revenue growth this fiscal year. Whether regulators will raise objections is not stated.
