Arlington Capital Partners to Sell BlueHalo to AeroVironment

Transaction will create next-generation defense technology company to advance national security

Washington, D.C. – November 19, 2024 – Arlington Capital Partners (“Arlington”), a Washington, D.C.-area private investment firm specializing in government regulated industries, today announced it has agreed to sell BlueHalo LLC (“BlueHalo” or the “Company”) to AeroVironment, Inc. (Nasdaq: AVAV) (“AV”) in an all-stock transaction with a transaction enterprise value of approximately $4.1 billion, creating a global leader in diversified all-domain defense technologies. The combined company will have a broad portfolio of high-growth franchises, powered by cutting-edge technology and focused on addressing the most important priorities and needs of our nation and allies around the globe.

Formed in 2019, BlueHalo is a purpose-built platform that Arlington conceptualized and developed to address the growing national security threats posed by Great Power Competition. Based in Arlington, VA, the Company provides industry-leading capabilities in several key mission areas: Space Technologies, Counter-Uncrewed Aircraft Systems (cUAS), Directed Energy, Electronic Warfare, Cyber, Artificial Intelligence, and other Emerging Technologies including Uncrewed Underwater Vehicles (UUVs).

“As national security threats continue to evolve along with the rapidly changing geopolitical landscape, the combination of BlueHalo and AV will provide much-needed advanced defense technology capabilities to the U.S. and its allies,” said David Wodlinger, a Managing Partner at Arlington Capital Partners. “BlueHalo has achieved tremendous success under Arlington’s ownership due to its deep technical expertise, focus on innovation, and strong leadership team. We are excited to continue to support BlueHalo in this next chapter as they join forces with AV to create a leading defense technology company with an unrivaled combination of growth and scale driven by innovation and proven next generation products.”

“Arlington’s deep domain expertise, operating acumen and national security relationships have been instrumental in helping establish BlueHalo as a trusted partner in defense innovation,” said Jonathan Moneymaker, Chief Executive Officer, BlueHalo. “Through this close partnership we have been able to build a world-class management team, make significant R&D investments, and opened new state-of-the-art facilities in Virginia, New Mexico, and Maryland near key customers in the space and intelligence communities. I am proud of all we have achieved together. We are confident that by combining with AV we will be able to continue leading the defense sector in innovation and next-generation defense solutions.”

Henry Albers, a Principal at Arlington Capital Partners, added: “Since inception, BlueHalo has focused on developing and maturing cutting-edge technologies with notable accomplishments including the first successful deployment of a directed energy counter-drone system and modernizing military space communication capabilities through the Company’s SCAR program. Bringing BlueHalo and AV together creates a leader in defense technology with the scale and resources to address the full spectrum of modern national security challenges.”

The transaction is expected to close in the first half of 2025, subject to regulatory and AV shareholder approvals as well as other customary closing conditions.

J.P. Morgan Securities LLC is serving as financial advisor and Goodwin Procter LLP is serving as legal advisor to Arlington and BlueHalo. RBC Capital Markets is serving as financial advisor and Latham & Watkins LLP is serving as legal advisor to AV.

About BlueHalo

BlueHalo is purpose-built to provide industry-leading capabilities in the areas of Space, C-UAS and Autonomous Systems, Electronic Warfare & Cyber, and AI/ML. The company develops and brings to market next-generation capabilities to support customers’ critical missions and national security. Learn more at http://www.bluehalo.com.

About Arlington Capital Partners

Arlington Capital Partners is a Washington, D.C.-area private investment firm specializing in government-regulated industries. The firm partners with founders and management teams to build strategically important businesses in the government services and technology, aerospace and defense, and healthcare sectors. Since its inception in 1999, Arlington has invested in over 175 companies and is currently investing out of its $3.8 billion Fund VI. For more information, visit Arlington’s website at www.arlingtoncap.com and follow Arlington on LinkedIn.

About AeroVironment

AeroVironment (NASDAQ: AVAV) provides technology solutions at the intersection of robotics, sensors, software analytics and connectivity that deliver more actionable intelligence so you can Proceed with Certainty. Headquartered in Virginia, AeroVironment is a global leader in intelligent, multi-domain robotic systems, and serves defense, government and commercial customers. For more information, visit www.avinc.com.