Space-Eyes SPAC merger sets $638 million equity valuation
Space-Eyes plans to list through McKinley Acquisition, but its $638 million valuation and funding depend on redemptions and PIPE conditions.
By Wei-Lin Zhao · AI Correspondent
· 3 min read
Space-Eyes has agreed to a Space-Eyes SPAC merger with McKinley Acquisition Corp. that would take the counter-drone technology company public at a stated $638 million pro forma equity valuation. The deal is expected to close in the fourth quarter of 2026, subject to shareholder, regulatory and Nasdaq approvals, and the combined company is expected to trade as CUAS if the listing is approved.
The transaction gives a small defense technology developer a proposed public-market valuation far above its reported current revenue. Reuters reported that Miami-based Space-Eyes has generated about $1 million in annual revenue while operating mainly as a research-and-development company. The company sells, or plans to sell, AI-driven counter-drone and geospatial-intelligence systems to governments, agencies and enterprises.
What does the Space-Eyes SPAC merger value mean?
The $638 million figure is an implied pro forma equity valuation, rather than cash being paid to acquire Space-Eyes. In its announcement, the companies said that valuation assumes McKinley shareholders do not redeem their shares and that the initial $5 million tranche of planned PIPE financing is received. They put the transaction's implied enterprise value at $370 million.
That distinction is material. McKinley said it has $176.7 million in trust capital and that it has sourced up to $75 million through a private investment in public equity, or PIPE. But the initial PIPE closing covers $5 million in senior secured convertible notes and is subject to conditions. A further $70 million in notes and warrants is also conditional on later closings. The companies have described potential gross proceeds of up to $251.7 million, but the final amount can change if public shareholders redeem their shares or financing conditions are not met.
A SPAC is a listed shell company formed to merge with a private business. McKinley's IPO prospectus gives public shareholders the right to redeem shares for a portion of funds in the trust account when a merger is completed. That structure means headline proceeds are not the same as committed operating cash.
Revenue and contract growth remain the central test
Reuters reported that Space-Eyes is negotiating roughly $35 million in potential contracts over five years, while its current awards are typically worth $300,000 to $400,000 annually. Those negotiations are prospective, not booked revenue. Reuters also reported that the company intends to use third-party manufacturers as it seeks government customers in multiple regions and commercial customers including cruise operators and data centers.
The company says its systems combine satellite, radar, radio-frequency and other sensor data to identify and respond to drone threats and provide geospatial intelligence. Those product and expansion claims come from Space-Eyes and McKinley's announcement and have not been independently verified in the materials reviewed.
Eric Trump was named as an investor and strategic adviser to the proposed combined company. Reuters reported that he recently became Space-Eyes' third-largest private investor and helped introduce potential board candidates. No investment amount or ownership percentage was disclosed. Reuters also reported that representatives for Trump did not respond to questions about measures to avoid potential conflicts of interest.
Space-Eyes is led by founder and CEO Jatin Bains. Reuters reported that the company said in January it was opening a Washington office to support federal contracting and government partnerships. Before the proposed listing can proceed, the parties must secure the required approvals, complete their financing steps and meet Nasdaq's listing requirements.
This story draws on original reporting from SiliconANGLE.
