Drone maker AEVEX eyes $2.35 billion valuation in US IPO

By Arasu Kannagi Basil

April 9 (Reuters) - ‌Drone maker AEVEX ​said ​on Thursday it was targeting a valuation of up to $2.35 billion in its U.S. initial public offering, the latest defense firm looking to ‌capitalize on investor appetite.

The Solana Beach, California-based company, backed by private ⁠equity firm Madison Dearborn Partners, is seeking up to $336 million by offering 16 million shares priced between $18 ‌and $21 apiece.

A growing number of ‌defense-linked companies have sought to tap the new listings markets in recent weeks as issuers look to seize on the opportunity created by the ongoing U.S.-Israeli ​war on Iran. Aerospace parts maker Arxis also kicked off its U.S. IPO roadshow on Wednesday.

"Defense-linked IPOs are benefiting from a window that has been building ⁠over the past year, with governments committing to higher military spending, leading to more analysts and investors describing ​the backdrop as a new defense 'supercycle'," Lukas Muehlbauer, research associate at IPOX, told Reuters.

AEVEX provides airborne intelligence, surveillance and reconnaissance offerings to ​the U.S. government and its allied forces. The ‌defense contractor's portfolio includes unmanned systems that can deliver munitions, explosive payloads and guided strikes against targets.

The war in Ukraine has ⁠underscored the crucial role of unmanned systems, with warfare increasingly moving toward drones. Roughly four million drones were produced in Ukraine alone in 2025, according to AEVEX's prospectus.

"Interest in the ⁠drone sector has grown as the war in Ukraine has shown how important drones have become ​in modern warfare, while tensions in the Middle East have added to that focus," Muehlbauer said.

"As a result, drones and drone-defense systems have become a major area of interest for investors looking ‌for thematic exposure to this growing part of the defense market."

An IPO would also come as a surge in conflicts across ‌the world drives up defense spending, with countries prioritizing modernization initiatives and investing in ⁠advanced systems to counter adversaries.

Goldman Sachs, ‌BofA Securities, and Jefferies are ​the joint lead bookrunning managers. AEVEX will list on the NYSE under the symbol "AVEX".

(Reporting by Arasu Kannagi Basil in Bengaluru; Editing by ‌Maju Samuel)

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