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Codan Group has announced that it has entered into a binding agreement to acquire 100 per cent of US network communications developer Kägwerks.
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The move, subject to regulatory conditions, is expected to occur in early December this year and be acquired through the group’s subsidiary Codan US, according to an ASX statement.
The acquisition consists of an upfront cash payment of approximately $33.6 million together with royalty payments for five years post-closing.
Kägwerks has previously developed tactical operator-worn networking communications technology that enables connectivity and integrated secure networking in military environments. A portfolio of “DOCK” branded tactical hardware and software was produced to provide improved situational awareness and strategic advantage in field operations.
In 2022, the company was selected as a provider of the US Army Nett Warrior Secure Wired and Wireless Intra-Soldier Network Hub (Nett Warrior Program), an advanced system developed by the US Department of Defence to improve situational awareness for soldiers on the battlefield. The Nett Warrior Program is a funded and stable DOD acquisition Program of Record.
“We are excited to announce that Kägwerks has officially joined the Tactical Communications division of the Codan Group, a global leader in communications technology,” Kägwerks president Niko Hughes said.
“By partnering with Codan’s world-class manufacturing capabilities and top-tier suppliers, we are positioned to scale our operations, delivering even greater quality, value, and service to support the needs of our customers.
“This relationship empowers Kägwerks to expand our global presence and reach new markets, enhancing our ability to serve customers worldwide.
“We remain fully committed to providing cutting edge, radio-agnostic dismounted communication solutions.”
The acquisition of Kägwerks is expected to align with Codan’s stated growth strategy to develop or acquire complementary IP and technologies, including a radio-agnostic dismounted communications solution and position Tactical Communications as a US soldier communications solutions provider.
The company is expecting “considerable sales opportunities” will arise from leveraging Codan’s existing global distribution network with an international export version of the DOCK products.
“We are excited to welcome the Kägwerks team to our Tactical Communications division and its technology suite to our solutions offering,” Tactical Communications president and executive general manager Paul Sangster said.
“Kägwerks’ intellectual property has been field tested and accepted into US Department of Defence, and its proven pedigree enables us to participate in additional tenders for other programs.
“A key strategic objective is to improve our revenue predictability and by participating in Programs of Record, this will increase predictability by securing stable, long-term multi-year contracts. The compatibility of DTC’s mesh radio with Kägwerks’ technology is highly complementary for our existing business.
“Together, Tactical Communications and Kägwerks represent a full solutions provider that will increase opportunities across key military and law enforcement markets. The combined business also positions us to leverage international distribution channels, opening new growth and collaboration opportunities in global markets.”
