Electro Optic Systems rally continues following $54m acquisition plan
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The news: Defence and counterdrone manufacturer Electro Optic Systems’ (EOS) shares lifted for a second day after announcing plans to acquire counterdrone system developer MARSS Group for a cash consideration of $54 million.
The numbers: At 11:13am AEDT, shares in EOS had lifted 10.11% to $11.
The upfront cash consideration is expected to be funded through EOS’ existing cash reserves, which was about $107 million as of 31 December.
An additional maximum earnout of EUR100 million ($174 million) will also be available to MARSS management shareholders. This will be paid at a rate of EUR20 million per EUR100 million in contract value signed for orders.
The EUR20 million can be paid in cash or EOS shares, with remaining earnout consideration to be paid in EOS shares.
The context: UK-based, Monaco-headquartered MARSS develops proprietary command and control systems used in the detection and countering drones. The acquisition is expected to be broadly earnings and cashflow neutral in 2026 but contribute positively from 2027.
EOS’s financial adviser was Oaklins while its legal advisers were Hogan Lovells and Minter Ellison.
EOS previously announced it would acquire the MARSS interceptor business for EUR5.5 million in November.
The source: ASX
