Arotech Corporation announced that it has closed on a private placement of $2.985 million with Admiralty Partners Inc., an A&D-focused investment firm. Admiralty purchased 1.5 million shares of stock at a price of $1.99 per share and its Chariman and CEO, John B. Kutler, will join Arotech's Board. Arotech is a provider of defense and security products for the military, law enforcement, and homeland security markets including simulators/trainers and power systems. A cursory look at the company's financials shows a business that has had slim to negative operating margins.
Kutler states: "Arotech is positioned at the confluence of two trends in the defense industry – disproportionate government investment in key growth areas and the consolidation of the fragmented third-tier supplier base. Its strong presence in training and simulation and power systems, combined now with an increased capability to participate as a consolidator, are expected to provide multiple opportunities and avenues for growth and enhanced shareholder value."
Sounds like they may be looking at future bolt-on acquisitions.
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