Nov 19 Reuters AeroVironment will buy space and defense engineering company BlueHalo in an allstock deal valued at about 4.1 billion, the companies said on Tuesday, as the drone maker seeks to broaden its portfolio amid rising geopolitical tensions.

The company39;s shares, up 56 this year, fell 3.6 in premarket trade.

AeroVironment, which makes the Switchblade loitering munition systems, will issue about 18.5 million shares to Arlington, Virginiabased BlueHalo as part of the deal.

BlueHalo, majority owned by private equity firm Arlington Capital Partners, is a defense tech company that makes drone defense systems and laser communication technology used in space missions.

AeroVironment39;s shareholders will own about 60.5 of the combined company post the completion of the deal, which is expected in the first half of calendar 2025.

BlueHalo39;s equity holders will own about 39.5, with Arlington retaining a significant stake in the combined company.

The combined company will have a presence in segments including counterUAS systems that help defend against drone strikes, alongside cyber and space technologies.

AeroVironment39;s CEO Wahid Nawabi will lead the combined company, while BlueHalo39;s Jonathan Moneymaker will serve as a strategic adviser to Nawabi.

Reporting by Utkarsh Shetti in Bengaluru; Editing by Sriraj Kalluvila

Source Reuters