Leonardo DRS has agreed to acquire Raft LLC, a U.S.-based defense technology and software company, for approximately $450 million in an all-cash transaction.
The deal, announced on July 28, 2026, is designed to strengthen Leonardo DRS’s capabilities in artificial intelligence (AI), data fusion, mission software, and open-architecture technologies.
The acquisition is strategically important because modern military systems generate large amounts of information from sensors, satellites, aircraft, drones, vehicles, and other platforms. The ability to bring this information together and turn it into useful, real-time intelligence is becoming increasingly important.
By combining Leonardo DRS’s sensors, computing and defense technologies with Raft’s software and AI capabilities, the companies aim to provide more integrated solutions for defense customers.
The transaction is expected to close in Q4 2026, subject to regulatory approvals and other customary closing conditions.
Key Details of the Acquisition
| Detail | Information |
| Acquirer | Leonardo DRS, Inc. |
| Target | Raft LLC |
| Deal Type | Acquisition |
| Deal Value | $450 million |
| Payment | All cash |
| Announcement Date | July 28, 2026 |
| Raft Founded | 2018 |
| Raft Headquarters | McLean, Virginia, U.S. |
| Leonardo DRS Stock | NASDAQ: DRS |
| Acquirer Country | USA |
| Industry | Defense Technology |
| Expected Closing | Q4 2026 |
| Regulatory Approval | Required |
| Expected Tax Benefit | Approximately $50 million present value |
| Financial Advisor to DRS | Morgan Stanley |
| Financial Advisor to Raft | J.P. Morgan |
Leonardo DRS Company Introduction
Leonardo DRS, Inc. is a U.S.-based defense technology company listed on the NASDAQ under the ticker DRS.
The company develops advanced technologies and systems for the U.S. military, intelligence organizations, defense customers and allied nations.
Its major technology areas include:
- Advanced sensing
- Radar
- Electronic warfare
- Network computing
- Communications
- Cyber systems
- Force protection
- Naval systems
- Electric power and propulsion
- Mission systems
Leonardo DRS operates through two major business segments:
1. Advanced Sensing & Computing
This segment focuses on technologies such as sensors, radar, electronic warfare, network computing and communications.
2. Integrated Mission Systems
This segment includes ground vehicle integration, force protection, naval power and propulsion systems, and other mission-related technologies.
According to the company’s information, Leonardo DRS generated approximately $3.6 billion in 2025 revenue, with a total backlog of about $8.7 billion and approximately 7,300 employees.
Raft LLC Company Introduction
Raft LLC is a U.S.-based defense technology and software company headquartered in McLean, Virginia. The company was founded in 2018.
Unlike a traditional defense manufacturer that focuses mainly on physical hardware, Raft focuses heavily on software, artificial intelligence, data integration and mission applications.
Its technologies are designed to connect information from different systems and data sources and provide military users with better real-time situational awareness.
Raft’s key capabilities include:
- Artificial intelligence
- Data fusion
- Mission software
- Open-architecture software
- Data integration
- Real-time situational awareness
- Command-and-control support
- AI-enabled decision-making
In simple terms, Raft’s software helps bring information from different sensors and systems together and turn that data into useful information for mission operators.
Why Is Leonardo DRS Acquiring Raft?
The main reason behind the acquisition is the combination of hardware, sensors, computing, software and AI.
Leonardo DRS already has strong capabilities in sensors, radar, electronic warfare, computing and defense systems.
Raft brings a different but complementary set of capabilities, particularly in:
AI + Data Fusion + Mission Software + Open Architecture
This creates a potential technology combination like:
Sensors → Data → Software/AI → Analysis → Decision
For example, a military operation may involve information coming from:
- Ground radar
- Aircraft sensors
- Drones
- Satellites
- Vehicles
- Communications systems
- Command systems
If all these systems operate separately, it can be difficult for operators to get a complete picture of what is happening.
Data-fusion software can help bring information from these different sources together.
What Does Raft’s Data Fusion Technology Do?
Data fusion is one of the most important parts of this acquisition.
Imagine a military operation where:
- A radar detects an object.
- A drone provides additional information.
- An aircraft sensor detects another signal.
- A satellite provides location data.
- Another defense system contains historical information.
Instead of forcing an operator to look at each system separately, data-fusion technology can combine information from multiple sources.
AI and software can then help organize and analyze that information.
The objective is to create a more unified view of the operational environment.
In simple terms:
Different Data Sources → Data Fusion → AI/Software → Better Situational Awareness
This can help military operators understand complex situations more efficiently.
Why Is Open Architecture Important?
Another important capability Raft brings to Leonardo DRS is open-architecture software.
Open architecture generally means that a technology system is designed to work with different systems and technologies rather than being completely locked into one proprietary platform.
This can be important for defense organizations because military forces often operate equipment and systems supplied by different companies and developed at different times.
If software can connect with multiple systems, customers may have more flexibility when adding new technologies.
Leonardo DRS has described Raft’s open-architecture capabilities as complementary to its existing sensing and computing technologies.
$450 Million All-Cash Transaction
Leonardo DRS has agreed to pay approximately $450 million in cash for Raft.
An all-cash acquisition means Raft’s owners will receive cash consideration rather than primarily receiving Leonardo DRS shares.
Leonardo DRS has said that the transaction will be funded through a combination of:
- Cash on hand
- Borrowing under its revolving credit facility
The transaction therefore represents a significant strategic investment by Leonardo DRS to expand its software and AI capabilities.
Expected $50 Million Tax Benefit
The acquisition also includes an important financial benefit.
Leonardo DRS expects to receive tax benefits over approximately 15 years, with a present value of around $50 million.
In simple terms, the company expects the acquisition structure to generate future tax savings.
Therefore, the headline purchase price of $450 million does not necessarily represent the entire economic impact of the transaction because expected future tax benefits also need to be considered.
Raft’s $99 Million U.S. Army Contract
Raft announced another important development in August 2026.
On August 19, 2026, Raft announced that it had received a five-year, $99 million IDIQ contract from the U.S. Army Contracting Command.
The contract can allow Army organizations to purchase Raft’s:
- Software platforms
- Data integrations
- Secure computing infrastructure
- Support services
An IDIQ (Indefinite Delivery, Indefinite Quantity) contract does not mean that Raft immediately receives the full $99 million.
Instead, it provides a contractual framework under which individual orders can be placed during the contract period based on the government’s requirements.
This is important because it shows that Raft has an existing relationship with the U.S. defense market and that its software and data capabilities have potential applications across military organizations.
Raft’s Work Across Defense Programs
Raft’s technology is not limited to one particular defense platform.
The company has described work involving organizations and missions across areas including:
- U.S. Army
- U.S. Air Force
- U.S. Space Force
- U.S. Special Operations Command
Raft has also announced work related to the U.S. Space Force’s Kronos program, involving a Dynamic Planning & Battle Management System.
This shows that Raft’s technology is being positioned for multiple defense missions where data integration, software and real-time decision support are important.
What Could Leonardo DRS Gain From the Acquisition?
The acquisition could expand Leonardo DRS’s capabilities in several important areas.
1. Stronger AI Capabilities
Leonardo DRS already has significant sensing and computing technologies.
Raft adds additional AI and software capabilities to this technology base.
2. Better Data Fusion
Modern defense systems can generate huge amounts of data.
Combining data from multiple sensors and systems can help create a more complete operational picture.
3. Stronger Software Business
The acquisition gives Leonardo DRS greater exposure to software and AI-based defense solutions.
This is important as defense systems increasingly depend on software in addition to physical hardware.
4. Integrated Mission Solutions
The broader strategic objective is to bring different technologies together.
Leonardo DRS provides:
Sensors + Computing + Communications + Defense Systems
Raft adds:
Data + AI + Software + Data Fusion
Together, these capabilities could allow Leonardo DRS to offer more integrated mission solutions.
Why Is This Acquisition Important for Defense Technology?
Modern defense systems are becoming increasingly connected.
A military platform may depend on information from many different sources rather than operating as an isolated system.
For example:
Leonardo DRS Sensors
↓
Network & Computing
↓
Raft Data Fusion
↓
AI & Mission Software
↓
Real-Time Situational Awareness
↓
Human Decision-Making
This illustrates the strategic logic behind the acquisition.
The goal is not simply to add another company to Leonardo DRS. It is to combine sensing and computing hardware with software, AI and data-fusion capabilities.
Leonardo DRS Financial Position
Leonardo DRS announced strong business activity around the time of the acquisition.
For the second quarter of 2026, the company reported:
| Q2 2026 Metric | Reported Figure |
| Revenue | $913 million |
| Year-over-Year Revenue Growth | 10% |
| Net Earnings | $86 million |
| Adjusted EBITDA | $128 million |
| Bookings | $1.1 billion |
| Funded Backlog | $5.1 billion |
Leonardo DRS said its Q2 2026 guidance did not include the impact of the Raft acquisition.
This means the financial contribution from Raft would be reflected after the transaction closes and Raft becomes part of Leonardo DRS’s financial reporting.
Potential Challenges
Like other acquisitions, the transaction also involves risks.
Some of the important areas to watch include:
Regulatory Approval
The transaction must satisfy applicable regulatory requirements before closing.
Technology Integration
Combining Raft’s software with Leonardo DRS’s existing systems may require significant technical and organizational work.
Employee Retention
Raft’s value is closely connected to its software, AI and engineering capabilities. Retaining key employees can therefore be important.
Integration Costs
The acquisition itself is not the only expense. Integrating operations, technology and teams can create additional costs.
Realizing Expected Benefits
The strategic benefits expected from the acquisition may take time to appear in Leonardo DRS’s financial results.
Leonardo DRS has identified regulatory approvals, integration challenges, employee retention, transaction and integration costs, and the possibility that expected benefits may not be fully realized among the risks associated with the transaction.
Final Analysis
The Leonardo DRS–Raft LLC acquisition is primarily a strategic move to strengthen Leonardo DRS’s position in AI, data fusion and mission software.
Leonardo DRS already has a broad portfolio covering sensors, radar, electronic warfare, computing, communications and defense systems. Raft adds capabilities in AI, software, data integration and open architecture.
The basic idea can be summarized as:
Leonardo DRS = Sensors & Defense Hardware
Raft = AI, Data Fusion & Mission Software
The acquisition aims to bring these capabilities together.
For Leonardo DRS, the deal could expand its software and AI capabilities and help it provide more integrated solutions for defense customers. However, the actual financial impact will become clearer after the transaction closes and Raft’s operations are incorporated into Leonardo DRS’s financial results.
Source: Leonardo news, SEC
