Key insights
- AeroVironment's acquisition of ESAero for $200M signals growth in the defense tech sector, particularly unmanned aircraft systems. Increased defense spending and drone adoption in global conflicts are tailwinds. The deployment and subsequent investigation into AeroVironment's LOCUST system highlights both the opportunities and regulatory scrutiny in the counter-drone market, potentially impacting future contracts and market sentiment.
March 16 (Reuters) - Drone maker AeroVironment said on Monday it has acquired Empirical Systems Aerospace, a producer of unmanned aircraft systems and advanced air mobility platforms, in a cash-and-stock deal valued at about $200 million.
ESAero will operate as a subsidiary of AeroVironment, reporting into its precision strike and defense systems group, which makes Kamikaze drones, or loitering munitions.
The deal unfolds against a backdrop of increased defense outlays and growing adoption of precision drones amid ongoing global conflicts, and follows AeroVironment’s $4.1 billion purchase of space and defense engineering firm BlueHalo in 2025.
"ESAero’s capabilities are vital to addressing the urgent demands of a fast-growing defense tech market," said AeroVironment CEO Wahid Nawabi.
Last month, two sources exclusively told Reuters that the U.S. Army deployed AeroVironment’s LOCUST laser counter-drone weapon system near El Paso International Airport, leading to a seven-hour airspace shutdown.
That, along with another incident later in February where the U.S. military errantly shot down a government drone with a laser-based anti-drone system, last week prompted a top Democrat on the U.S. Senate Commerce aviation subcommittee to call for a government investigation into the events.