- Shield will acquire Echodyne to expand its mission systems business
- Echodyne radars support counter-drone operations and airspace security in more than 40 countries
- The transaction is expected to close in early 2027
Shield has agreed to acquire radar manufacturer Echodyne in a $5.3 billion transaction, adding counter-unmanned aircraft systems capabilities and radar manufacturing operations to its defense technology portfolio.
Shield said Thursday the acquisition will expand its mission systems business with Echodyne’s metamaterials-based radar technology. The transaction is expected to close in early 2027, pending regulatory approvals and other customary closing conditions.
What Does Echodyne Bring to Shield?
Echodyne develops compact, solid-state radars using its patented Metamaterials Electronically Scanned Array, or MESA, technology. The radars are designed to detect and track unmanned aircraft and can be integrated with remote weapon stations, high-energy lasers and high-power microwave systems to help direct interceptors toward incoming drones.
Civilian customers in more than 40 countries use security and counter-drone systems equipped with Echodyne radars to safeguard airports and stadiums from unauthorized drone activity and help police and fire departments operate drones safely in shared airspace.
Joint Interagency Task Force 401 awarded Echodyne a contract with a $250 million ceiling in September for the supply of counter-drone radar to U.S. and allied forces. The award was one of 10 indefinite-delivery/indefinite-quantity contracts the U.S. Army issued under Domestic Shield, a Department of War initiative to protect high-priority defense facilities and assets from drones. The 10 contracts had a combined ceiling of $4.15 billion.
Echodyne CEO Eben Frankenberg said hundreds of customers use the company’s products to detect and track drones, protect infrastructure, secure borders and support airspace operations.
The companies anticipate a record triple-digit revenue growth this fiscal year.
How Will the Deal Expand Shield’s Mission Systems Business?
Shield CEO Gary Steele said the company is organizing its business around three units: autonomy software, autonomous systems and mission systems. He said Echodyne’s capabilities will help address demand for multi-mission technologies and expand its presence in the counter-drone market.
The acquisition adds radar technology to Shield’s portfolio of autonomy software, simulation products and autonomous aircraft. The company’s existing offerings include Hivemind autonomy software, Aechelon simulation for training and testing, and the V-BAT and X-BAT autonomous systems. Shield completed its purchase of Aechelon in June, three months after announcing the deal in March.
Echodyne recently opened an 86,350-square-foot manufacturing facility in Kirkland, Washington, following a $40 million investment. The site is designed to produce approximately 30,000 radars annually. Shield also identified Washington as the production location for its X-BAT system in September.
What Are the Terms of the Echodyne Acquisition Deal?
Shield will pay and issue $4.8 billion at closing, with up to an additional $500 million contingent on Echodyne meeting agreed-upon performance targets.
Shield is assembling $2.5 billion in financing, comprising a $1 billion Series H round, a separate $1 billion structured equity investment from funds managed by Blackstone and $500 million in debt financing arranged by JPMorgan Chase Bank.
The Series H funding values Shield at $28.8 billion post-money. Disruptive and Innovation X Capital are co-leading the round, with participation from Advent, the Strategic Investment Group of JPMorganChase’s Security and Resiliency Initiative, Snowpoint Ventures, Apandion, and Center15 Capital, among others. The proceeds will primarily support the Echodyne purchase. Shield used proceeds from its March fundraising to help fund the Aechelon acquisition, expand Hivemind and advance X-BAT development.
Echodyne will retain its workforce and continue offering MESA radars as standalone products. Frankenberg will report to Steele while overseeing the company’s products, manufacturing operations and customer relationships.
