Archer Aviation Inc. (NYSE: ACHR) has announced a strategic partnership with Anduril Industries Inc. to develop a next-generation hybrid propulsion, vertical-take-off-and-landing (VTOL) aircraft for defense applications. This comes as part of Archer's new Archer Defense program, with the first aircraft targeting a potential program of record from the United States Department of Defense (DoD).
To support this initiative and for general corporate purposes, Archer raised an additional $430 million in equity capital. This brings the company's total capital raised to nearly $2 billion to date. As of the end of Q3’24, Archer had $502 million in cash and cash equivalents on its balance sheet. This substantial raise further solidifies Archer's financial position, positioning it with one of the sector's leading balance sheets with no near-term financing needs.
The capital raise saw participation from strategic partners Stellantis and United Airlines, as well as new institutional investors such as Wellington Management and Abu Dhabi Investment Holding Company 2PointZero, a subsidiary of UAE’s largest listed entity, IHC.
Shane Arnott, SVP of Engineering at Anduril, emphasized the importance of rapid innovation and scalable production for maintaining technological superiority. He expressed Anduril's shared vision with Archer in advancing capabilities to meet urgent national security needs and their anticipation of partnering to bring advanced vertical lift aircraft to customers.
Adam Goldstein, Founder and CEO of Archer, stated that with Anduril's collaboration and the new influx of capital, the company will accelerate the development and deployment of advanced aerospace technologies at scale.
The Archer Defense program will be led by Joseph Pantalone, who recently joined Archer and brings nearly 30 years of experience in military aviation from Lockheed Martin and Sikorsky. He will have the continued support of Archer’s world-class defense advisory board, formed in May 2023, and comprised of highly decorated and distinguished retired military leaders.
Moelis & Company LLC acted as the exclusive placement agent to Archer on this transaction.
The partnership between Archer and Anduril aims to leverage Archer's ability to rapidly develop advanced VTOL aircraft using existing commercial parts and supply chains, combined with Anduril's expertise in artificial intelligence, missionization, and systems integration. This collaboration is expected to accelerate the speed to market for critical hybrid VTOL capabilities at a fraction of the cost of more traditional alternatives. Following these announcements, the company's shares moved -2.2%, and are now trading at a price of $7.22. Check out the company's full 8-K submission here.
