Aerodrome recruits new investors as share price soars

Three months after the share price of Aerodrome Group (TASE: ARDM) fell to an all-time low, giving the UAV company a market cap of just NIS 24 million, it has soared by 830% (more than ninefold) to a current market cap of almost NIS 225mn. This followed the announcement of a series of investments in the company by several parties that are still subject to approval by the shareholders at a meeting due to be held within the next few weeks.

Aerodrome, which for the past year has been headed by Mishel Ben Baruch, designs, develops, and produces unmanned aerial vehicles (UAV) for both military and civilian use, together with AI-driven data gathering, analysis and processing by means of UAVs.

Aerodrome became listed on the stock exchange in 2020 at a valuation of NIS 50 million. In the ensuing months its share price shot up to a peak that gave the company a market cap of over NIS 400 million, but investors’ enthusiasm then cooled off. A little over a year ago, the company’s share price plummeted after it was reported that the Ministry of Defense had reduced an order that had been worth NIS 73.6 million, and it later became known that the company delayed reporting the matter.

The previous CEO, Roy Degani, who founded the company, subsequently resigned, He currently serves as a strategic consultant to the company’s management, and still holds 22.4% of the shares, before completion of the current investment deals. The Israel Securities Authority later published an audit report that spoke of “a worrying and serious picture” concerning the board of directors’ ability to fulfil its responsibility to supervise the work of the company and its management because of “material gaps between the way in which the board perceived its function and the conduct of the company’s management.” The audit findings highlighted material flaws in the decision-making process at the company, with an emphasis on the former CEO. In December 2025, a search was carried out at the company’s offices and former and current managers were questioned.

Despite this background, and thanks to Aerodrome’s trendy field of business, and apparently also thanks to the drop in its share price, there are those who have found renewed interest in it. Earlier this month, the company released a number of reports about investment. A group of investors will be allocated a 35% stake in it for NIS 41 million. Most of the shares will go to one investor who will hold a 32% stake and become the controlling shareholder. Later on, IBI Investment House joined the investor group. It will inject NIS 6.8 million into Aerodrome and increase its holding to 7%.

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Meanwhile, Aerodrome has announced a further private placement, to AgEagle Aerial Systems (NYSE: UAVS), which will buy a 7% holding in the company for NIS 9.2 million. Negotiations are taking place between the two companies on setting up a joint marketing and distribution arm in the US.

All these investments will take place at a price of NIS 0.80 per Aerodrome share, which represented a premium at the time of the initial report at the beginning of the month, but which because of the sharp rise in the share price since then now represents a discount of about 66%. As mentioned, all of these transactions, in which about half the company’s share capital will be allocated to the new investors, are subject to shareholder approval.

Eyal Goren, deputy CEO of IBI Mutual Funds, told “Globes”: “It’s clear to everyone that there’s a very big event in the Israeli defense sector. There is very high demand for the sector, and there’s an event that is difficult to comprehend at the pricing level.” IBI has an active mutual fund launched six months ago that specializes in investment in defense stocks in Israel, with over NIS 1 billion under management. The fund has yielded a return of almost 50% since it was launched.

“We are constantly looking for places that generate good risk management for the fund’s unit holders. Aerodrome has great growth potential. It certainly could be that the market is overoptimistic and that the price is inflated – and that’s true of almost all companies in the sector – but it’s incorrect just to look at the pricing. The challenge for the companies in the sector is to meet the demand for their products, and not the question whether the demand will come along. The demand will only rise.”

Nevertheless, Goren stresses that the allocation to IBI is in fact at a discount of nearly 70% on the current market price. “For our investors, this is a risk management event. Unlike anyone who buys the share today, we are receiving a discount and paying NIS 80 instead of NIS 2.5,” he says. “In the end, that’s the advantage of an active fund. In a sector that is priced high, it makes sense to manage risk. We are very big in the sector, and therefore we were approached, and this investment is a risk management move in a mutual fund that is very active in the sector.”

In a survey of the sector, Oppenheimer talks of “swarms of drones/robots/ships that are 1/10th the cost of and often more efficient than legacy military equipment,” and states: “Whoever wins the drone swarm arms race will win the war.”

Oppenheimer says that AI is the core technology that enables UAVs to turn from manually operated devices to devices that function almost autonomously. Oppenheimer’s favorite stock in the sector is Ondas (Nasdaq: ONDS), which has a market cap of $4.6 billion and has acquired a series of companies, several of them in Israel.

Published by Globes, Israel business news – en.globes.co.il – on March 17, 2026.

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