About RADA Electronic Industries

RADA Electronic Industries Ltd. operates as an Israel based global defense electronics company. The company specializes in the development, manufacture, marketing, and sale of tactical land radars for defense forces and for critical infrastructure protection applications, and military avionics for manned and unmanned aircraft. The company develops, manufactures, and sells defense electronics, including tactical land-based radars for defense forces and for critical infrastructure protection solutions, avionics solutions for unmanned aerial vehicles and airborne data/video recording and management systems. In 2019, the company completed the sale of its legacy commercial products subsidiary, Beijing Hua Rui Aircraft Maintenance and Service, Co., Ltd., known as CACS. In March 2018, the company announced the formation of a joint venture company with SAZE Technologies LLC. The new company, RADA Technologies LLC (RTL), is based in Germantown, Maryland. In July 2019, the company acquired full ownership of RTL. RTL is focused on the adaptation of the company’s tactical radar technology for the U.S. market, certifying the radars to the U.S. standards, producing the company’s radars for the U.S. market needs, and providing infrastructure for maintenance and support. In 2020, the company formed a new company, RADA Innovations LLC (RIL), to perform certain classified work on its radars for the U.S. market. RIL began its operations in 2021. The company is a product-oriented company focused on the defense electronics market. The company is developing its products utilizing its internal resources, and as a result the company owns the proprietary rights and is able to address a wide range of customers and integrators. Products and Services The company primarily sells defense electronics products. The company may also provide end-to-end solutions for one or more systems or sub-systems. The company’s product lines are tactical radars, land-based, for defense forces and critical infrastructure protection solutions; and military avionics (data/video recorders, and core avionics for aircraft and unmanned aerial vehicles (UAVs)). Land-Based Tactical Radars for Defense Forces and Critical Infrastructure Protection Solutions The company develops advanced land-based radars for tactical applications, such as defense forces protection and critical infrastructure protection. The company’s pulse Doppler, software-defined radars are solid-state, fully digital, incorporate active electronically scanned array, or AESA antenna, are compact, mobile and highly reliable, provide hemispheric spatial coverage and multi-mission capabilities and can operate on-the-move, or OTM. The company’s tactical radars, which move with the maneuvering combat units in the field and operate OTM, provide the real-time knowledge of whether and from where they are threatened, detect all relevant threats, whether unfriendly fire or Drones/UAVs/fighters/helicopters from any angle (including very high angles), discriminate among threats and provide the needed intelligence for any course of action, whether counter-fire or avoidance. The company has developed various radar hardware platforms, such as the compact hemispheric radar (CHR) and its advanced variants, eCHR, aCHR and iCHR, which are tailored for use on combat vehicles and short-range protection applications; and a family of multi-mission hemispheric radars, or MHRs, and its advanced variants, ieMHR, nMHR and exMHR, which are tailored for use in force and critical infrastructure protection applications. All of the company’s radar platforms share basic characteristics, but differ in range, size, frequency band in some cases, weight, and price. The company implements several operational missions for its platforms by soft-changing the radar operational parameters. The operational missions of the CHR family of radar platforms are: Radar sensors for active protection systems, or APS, detecting all relevant threats that may be fired at combat vehicles, including RPGs, anti-tank guided missiles (ATGMs) and projectiles and provide 360° hemispheric coverage. The system delivers threat data to the APS, enabling it to neutralize threats. Very-short-range hemispheric air surveillance radar system, which can detect, classify and track aerial vehicles, with emphasis on small UAVs. Mobile or stationary, the system can be integrated with any C4I system and other radars and sensors, and can operate either as a stand-alone, or as part of a large-scale surveillance system. Perimeter and border protection, detecting, identifying, and tracking aerial and surface intruders, including slow and small aircraft, vehicles, vessels, and pedestrians at tactical ranges. The company’s radars can operate either on a stand-alone basis, or as part of a large-scale surveillance system. The operational missions of the MHR family of radar platforms are the following: Hostile fire detection radar systems, which detect, track, classify and locate direct and elevated threats fired at stationary or mobile forces. They compute the Point-of-Origin (POO) and Point-of-Impact (POI) of the threats, which may be rockets, artillery, mortars, ATGMs, RPGs, and more other threats. The systems can be integrated with any protection and Command, Control, Communications, Computers and Intelligence (C4I) system and be installed at stationary bases and posts, or onboard fighting vehicles. Tactical hemispheric air surveillance radar systems, which detect, classify and track all types of aerial vehicles, including fighters, helicopters, UAVs, transport aircraft, etc. at tactical ranges. Mobile or stationary, the systems can be integrated with any C4I system and other radars and sensors, and can operate either as a stand-alone, or as part of a large-scale surveillance system. Three-dimensional perimeter surveillance radar systems for critical infrastructure protection can detect, identify, and track aerial and surface intruders, including slow and small aircraft, air breathing targets, vehicles, vessels, and pedestrians at tactical ranges. The systems can operate either as a stand-alone, or as part of a large-scale surveillance system. Among the company’s customers and users of its radar systems are leading defense forces and defense contractors worldwide, including the Israeli MOD, IMI (an Elbit Systems Ltd. (Elbit Systems or Elbit) subsidiary), Elbit, Rafael, MER Group, Lockheed Martin (Lockheed Martin Corporation), Boeing (Boeing Defense, Space & Security), Leonardo DRS, Anduril, CACI, General Atomics, Elettronica, the U.S. Marine Corps and Navy, the U.S. Air Force, Indian Security Forces, Rheinmetall, Leonardo, MBDA, Thales (Thales Group), and many additional integrators and end-users. Some of the company’s customers have purchased a small number of radars for evaluation and integration in their air defense and/or other systems. These initial purchases may turn into larger production orders upon evaluation. Military Avionics The company is active in the field of mission data and video recording, management, and post-mission analysis and debriefing for fighter and trainer aircrafts. The company has developed, fielded and supported a wide range of solid-state digital recorders, cameras and debriefing systems for aerospace and military applications, including digital video/audio/data recorders, or DVDR (with data transfer functions); HD-DVDR, high definition digital video/audio/data recording for fighter and trainer aircraft; a wide range of head-up-displays color video cameras, or HCVC, for fighter aircraft; and a variety of ground debriefing solutions, or GDS. These digital recorders feature technologies and are designed for military applications. The company’s high-performance recorders provide simultaneous, high-capacity video (both analog and digital/HD), audio and data recording, high throughput and mass storage handling capabilities, supporting rapid dissemination and real-time playback. The company’s video recorders implement MPEG-2 and/or MPEG-4 (H.264) compression formats and facilitate continuous recording over extended mission durations. Recent upgrades to the company’s recorders provide the ability to record high-definition video formats, such as HD-SDI. The company’s GDS synchronized video, audio, data, and air combat maneuvering debriefing. GDS vary from personal, laptop-size debriefing units, through robust desktop multi-channel systems supporting the mission debriefing of four-aircraft formations up to large-scale simultaneous debriefing systems. These network-based systems support large numbers of participants operating from different locations and provide advanced data management features. The company is a developer and manufacturer of core avionics systems. The company offers a wide spectrum of military avionics systems designed for integration in new and upgraded military aircraft and UAVs worldwide. The company’s core avionics products are easily adapted to western, eastern, and indigenous-origin platforms of all kinds. In particular, the company’s avionics for UAVs are extremely compact through modern board connectivity solutions, use of innovative passive/conductive cooling techniques, withstand extreme environmental conditions and are very reliable and affordable. The company offers various avionics solutions, such as mission data recorders and debriefing solutions and HUD video cameras; and avionics for UAVs (Interface control processors, engine control computers, Payload management computers and others). The company’s airborne products and system solutions are fully qualified and operated by leading air forces and prime integrators worldwide, such as the Israeli Air Force, Lockheed Martin, Boeing Company, HAL, Embraer, IAI, Rafael, the Chilean Air Force, and many others. The company’s units are installed onboard F-16, F-15, T-6, A-4, Jaguar, MiG-27, Su-30MKI, Dhruv Helicopter, MiG-29, Super-Tucano and other aircraft, and onboard a large number of UAVs. Business Development, Sales and Marketing Strategy The company’s business development strategy is based on the following principles: Becoming a reliable and trusted supplier of sensors and avionics sub-systems to defense system integrators and major platforms manufacturers with global sales, such as Lockheed Martin, Boeing, Elbit, IAI, Anduril, Rafael, Leonardo DRS, Embraer, HAL, Elettronica, CACI and others; Establishing operations in the company’s primary target markets (i.e. the U.S.), either through subsidiaries or through joint ventures, for local presence, direct market development, localization of the technology, production and customer support; Expanding the company’s global business development efforts and potential customer base, by engaging business development consultants and service providers in the countries and territories in which the company’s products may be used, and actively managing this global network; and Establishing strategic relationships with leading integrators in the prime target markets for tactical radars, i.e. the U.S., Europe, India; such relationships may involve indigenization and localization of the company’s technologies to enable sales in significant quantities in these markets. Strategic Relationships and Customers As part of the company’s strategy, it has established a number of strategic relationships with leading global defense contractors and several air forces. The company has focused its marketing and sales efforts to support these relationships. Lockheed Martin: Lockheed Martin is the manufacturer of the F-16 aircraft, one of the most popular fighter aircraft in the western world. The company is supplying the DVDR, HD-DVDR and GDS for new F-16 aircraft production and for F-16 upgrade programs led by Lockheed Martin. In 2015, Lockheed Martin ordered a single radar system for integration in their internally funded high energy laser research and development program and acquired a second radar for the same purpose. IMI Systems: IMI (a subsidiary of Elbit Systems) is a world leader in the field of APS for land platforms and is the developer and manufacturer of the ‘Iron Fist’ APS. The company teamed with IMI on the integration and production of its CHR family of radars as part of their ‘Iron Fist’ APS solution for local and global customers. During 2016, there was a global increase in the interest of major forces in APS. As a result, since then, the company is engaged in extensive efforts with IMI to integrate, test and provide its ‘Iron Fist’ APS to customers in Europe and North America, along with the company’s on-going support. The company has sold dozens of radars to IMI to support these activities. The company anticipates that these testing efforts will mature into acquisition programs. The first acquisition program was purchased by the IMOD in the end of 2019 to equip the Eitan fighting vehicle with the Iron Fist APS. Boeing Defense, Space and Security: Boeing, a provider of air defense and high-energy laser systems, acquired the company’s MHR in 2013 for evaluation of its use as part its directed energy tactical systems and in 2017 acquired the company’s MHR for integration into critical infrastructure surveillance solutions. The company also provides Boeing with recorders and debriefing stations for the T-45 VMTS and has received follow-on orders from Boeing. Leonardo DRS: DRS is a major player in the defense electronics market in North America, with a focus on tactical systems and radars. In 2017, the company signed a cooperation agreement with DRS to market and sell the company’s tactical radars in the North American market for counter-UAV, short-range air defense, and other solutions. DRS has acquired a few MHR radars and is actively promoting the company’s radars as part of their system solutions. In 2018, DRS was selected by the U.S. Army as the mission equipment package provider for the Army’s IM-SHORAD program, which includes the company’s MHR radars as onboard search sensors. This program has the potential for sale of 144 vehicles, each with 4 MHR radars on board. As of December 31, 2021, the company delivered radars for nine prototype units and spares, and a production purchase order for 87 vehicles incorporating 348 radar units. Anduril Industries Inc. (Anduril): Anduril is a fast-growing player in the defense electronics market in North America. Anduril provides base defense and force protection applications, critical infrastructure protection solutions, border security and counter drone systems. The company’s radars are integrated within such solutions. In 2020 and 2021, the company delivered more than 220 radars of the MHR family to be integrated with Anduril’s systems. European Air Defense Integrators: Two major European air defense integrators have purchased radars for integration and testing. The company has signed a value-added representation agreement with one of the integrators for certain countries where it has a dominant position in sales of air defense and other solutions. Rafael Advanced Defense Systems Ltd. (Rafael): Rafael is a world leader in the development and supply of missiles, smart weapons and pods of various types. Rafael has become a strategic customer of the company as a result of its development and production of a few advanced built-to-specification products. Rafael selected the MHR as the radar for the ‘Drone Dome’ system that is designed to counter UAVs and drones and is purchasing radars from the company for their customers. Military Forces: The company is a provider of digital recorders and debriefing solutions to the Chilean Air Force and to the Indian Air Force, through HAL. Two other Asian military forces have purchased radars for air surveillance and counter-mortar applications. Its tactical radars are used by all the U.S. defense forces for ground-based air defense, point defense, counter rocket, artillery and mortar solutions, and counter unmanned aerial systems. These strategic relationships with military forces provide the company with the potential for prolonged cooperation. Israel Aerospace Industries Ltd. (IAI): The company actively supplies avionics and test equipment to four different divisions of IAI, and in particular to the MALAT division, who is a major UAS global provider and utilizes its products and services for repeated follow-on orders. Hindustan Aeronautics Ltd. (HAL): HAL is the major aerospace integrator in India. The company is cooperating with four divisions of HAL and supplies DVDRs, HCVCs, GDS, support equipment and other services. Embraer S.A. (Embraer): The Military Aircraft Division of the Brazilian aircraft manufacturer is a strategic customer. In addition to supplying avionics, such as DVDR, INS and HCVC to Embraer, the company is participating in Embraer’s programs through the development and supply of avionic units per their specifications and their training and support activities. Geographical Markets The company sells its products to various air forces and companies worldwide. Joint Venture in India In August 2021, the company signed a Memorandum of Understanding with Alpha Design Technologies Pvt. Ltd. (Alpha Design), to establish a joint venture to market, manufacture, sell and support its radars in India. Alpha Design is 1,200+ person-strong, professional R&D and production organization, focused on the defense and aerospace domains. Research and Development The company’s research and development expenses were $10.0 million in 2021. Government Regulations The company is regulated by an Israeli law regulating export of ‘dual use’ items (items that are typically sold in the commercial market, but that also may be used in the defense market) and the Defense Export Control Law and its supplemental regulations. Manufacturing and Quality Management The company’s quality management system is certified by the Standards Institute of Israel, or SII, pursuant to ISO 9001:2015 for hardware design and production and ISO 90003:2018 for software design. The company’s environmental management system is certified by SII to ISO 14001:2015 (both in Israel and in the U.S.) and its quality management system is also certified according to AS-9100D (2016), a quality management system for aerospace requirements (both in Israel and in the U.S.). In February 2022, the company successfully achieved ISO 45000 Certification for occupational, health and safety management systems. Competition The company’s principal competitors in the avionics and recorder markets include Elbit Systems Ltd., Honeywell International Inc., IAI, Northrop Grumman Corporation, Sagem Avionics LLC., Thales Group, and Zodiac Aerospace Group. The company’s principal competitors on tactical radars are IAI (through its subsidiary, Elta), SRC Inc., Raytheon, Northrop Grumman, Dynetics (Leidos), SAAB, Thales, Hensoldt and Leonardo Selex. History RADA Electronic Industries Ltd. was founded in 1970. The company was incorporated under the laws of the state of Israel in 1970.