Archer Aviation shares jump nearly 10% on deal to acquire Boeingâs Wisk, two other units
Archer Aviation shares jumped nearly 10% on Monday after the air-taxi maker agreed to acquire Boeingâs electric aircraft business Wisk Aero and two other units
Archer Aviation shares jumped nearly 10% on Monday after the air-taxi maker agreed to acquire Boeingâs electric aircraft business Wisk Aero and two other units in exchange for a nearly 20% stake in Archer, Reuters reported.The stock opened at $6.41 and traded between $6.08 and $6.87 during the session, climbing as much as 14% in morning trading.The deal also includes drone manufacturer Insitu and airspace-services provider SkyGrid, giving Archer access to Boeingâs autonomous-flight technology and potentially strengthening its position in defence and commercial logistics.Boeing will receive a 19.75% stake in Archer and the right to appoint a director to its board. It will also retain access to Wiskâs technology for its commercial and defence aircraft programmes, Reuters reported.For Boeing, the divestments mark another step towards simplifying its portfolio, focusing on its core commercial-aircraft and defence businesses and scaling back its air-taxi ambitions.Archer, which has yet to generate significant revenue from its core business, will acquire Insitu, a profitable defence company with annual revenue of more than $200 million.Archer CEO Adam Goldstein told Reuters that the deal would allow the company to âstart generating significant revenue immediately in a major growth market.âHe added that demand for intelligence, surveillance and reconnaissance drones was likely at a record high, creating a major opportunity for an established business already generating revenue and cash flow.Wisk has been developing a self-flying electric passenger aircraft. However, despite years of investment and ambitious projections, the electric vertical take-off and landing, or eVTOL, industry has yet to demonstrate that air taxis can secure certification, achieve large-scale production and operate at prices affordable to mainstream customers.As commercial launches take longer than expected, eVTOL companies are increasingly targeting military, cargo and government applications to generate near-term revenue and secure funding.
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