Business
Australia’s EOS Shares Rise After $175M UAE Counterdrone Deal
Electro Optic Systems has won a US$124 million (A$175 million) order for the Slinger counter-drone system from UAE-based Generation 5 Holding. They have also reached an agreement to establish a joint company dedicated to high-energy laser weapons and defence systems.
Australia’s Electro Optic Systems (ASX:EOS) also saw its shares rise after announcing a US$124 million (approx A$175 million) order for its Slinger counter-drone system and a new joint venture with UAE-based defence firm Generation 5 Holding.
EOS shares were up 14.9% to $10.73. The stock–up was 284.6% over the past year. The company had been in a trading halt on Thursday prior to the announcement.
EOS wins US$124 Million Slinger Counter-Drone Order
EOS announced that it had received a US$124 million order from Generation 5 Holding, an Abu Dhabi-based provider of universal defence equipment, technology and services for its Slinger Counter-Drone Remote Weapon System.
It includes remote weapon systems, cannons, spare parts, training and other related supplies. EOS said the systems are aimed to bolster defensive capacities as tensions persist in the Middle East, regionally.
Deliveries of the systems, to be built in Australia and the UAE, are set for 2027 and 2028. Subject to Generation 5 Holding’s standard terms and conditions of sale and export authorisation.
EOS and Gen5 From UAE Laser Weapons Joint Venture
In addition to the counter-drone order, EOS and Generation 5 Holding entered a binding conditional agreement for an incorporated joint venture.
The joint venture is being established to develop, manufacture and distribute a next-generation 200-300kW High Energy Laser Weapon product on a global level. In addition, it will produce and market EOS’s High Energy Laser Weapon systems of 100-150kW capacity already developed in the United Arab Emirates (UAE) and select Middle East and North Africa (MENA) markets.
The joint venture will also produce and market the UAE and MENA-region specific versions of designated EOS R400, R500 and R800 remote weapon systems.
The new Joint Venture will be established in Abu Dhabi on a 50/50 equity and profit-share basis between EOS and Generation 5 Holding in accordance with applicable UAE laws and regulations, following requisite government approvals.
Strategic Placement and Future Contribution
Generation 5 Holding has also purchased $30 million in shares of EOS via a strategic placement. The placement is to be approved by the EOS stakeholders at its 26 June general meeting. The joint venture is expected to have a favorable impact on EOS’s financial results starting in 2027 or 2028, contingent upon certain conditions and other normal phased approvals.
The company added that the key steps needed to create the joint venture are completed. In the future, EOS and Generation 5 Holding may also decide to broaden the scope of the venture, including areas such as command-and-control systems and space control capabilities.
FAQs
What is the value of the EOS anti-drone contract?
The order is valued at US $ 124 million (around A$175 million).
Who ordered it from EOS?
The order has been made by UAE defence contractor Generation 5 Holding.
What purpose will the joint venture serve?
It will emphasize both high-energy laser weapons and the manufacture and distribution of certain EOS weapon systems.
Source: Mottley Fool
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