“Founders should be careful when accepting a part cash and part stock deal as it carries substantial liquidity and valuation risk. The $555M stock portion could lose value before they’re allowed to sell it, potentially turning an $855M deal into something much smaller if Firefly’s stock price drops.”
–Shruti Gurudanti, director of corporate transactions at Rose Law Group
By CNBC
Firefly Aerospace stock climbed 7% Monday, after the space company said it’s buying defense technology contractor SciTec for $855 million as it looks to strengthen its national security offering.
The deal, announced Sunday, is slated to close at the end of the year and includes $300 million cash and $555 million in Firefly shares.
“These capabilities significantly enhance our ability to deliver integrated, software-defined solutions for critical national security imperatives, particularly Golden Dome,” said CEO Jason Kim in a release.
The company plans to integrate SciTec’s software into its tools. Capabilities such as missile warning, tracking and defense and autonomous command control will also support Firefly’s launch and space services, the company said.
