RedLattice plans to hit the public markets by combining with Bold Eagle Acquisition Corp., confirming an earlier Bloomberg News report in a Monday announcement. The transaction assigns RedLattice an enterprise value of roughly $1.25 billion, inclusive of debt, ahead of closing. In its 2024 IPO, Bold Eagle collected $250 million, and its shares ended Friday at $10.71, placing the SPAC's market cap around $617 million.
If the merger goes through, RedLattice expects up to about $610 million in gross proceeds. That figure includes $335 million committed by new and existing backers, plus up to $275 million held in the trust account of Bold Eagle. Loomis Sayles, an investment firm, will act as the anchor buyer for $275 million in convertible notes.
AE Industrial Partners - which bought a controlling interest in RedLattice in 2023 - is poised to be the largest shareholder at closing. AE Industrial Partners managing partner Kirk Konert said, "We believe RedLattice is the category leader in operational cyber intelligence with unmatched technical capabilities." Headquartered in Chantilly, Virginia, RedLattice describes itself as a global defense tech company serving military, law enforcement, and the intelligence community. According to its website, the company supplies cyber intelligence tools that the US government and allied nations use.
In 2024, AE Industrial Partners acquired Israeli security company Paragon in a transaction valued at up to $900 million to combine it with RedLattice, according to earlier Bloomberg News reporting. Paragon, co-founded in 2019 by former Israeli Prime Minister Ehud Barak, builds technology intended to assist law enforcement and intelligence agencies in collecting messages sent via encrypted phone services. That year, US Immigration and Custom Enforcement signed a $2 million agreement to purchase Paragon tools, a deal the Biden administration halted and the Trump administration reactivated last year. A portion of the RedLattice deal's proceeds will be used to pay a cash earn-out tied to the Paragon acquisition.
RedLattice will be led by CEO Andy Boyd, formerly the director of the CIA's Center for Cyber Intelligence. "We only sell, in the US context, to the US federal government, intelligence community, military and federal law enforcement," Boyd said in an interview. He said the company performs vulnerability research and converts those findings into products for customers legally empowered to pursue adversaries who operate through phones, computers and network equipment.
"Our biggest selling product has the capability where law enforcement users can actually enter the warrant into the program and put the warrant begin and expiration date so that the tool can't be used for a particular target beyond the warrant period," Boyd said. He added that the firm also serves US allies - among them European and East Asian nation-states and other democracies that undergo a rigorous vetting process - and that its work has no commercial use cases.
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Goldman Sachs Group Inc. is advising Bold Eagle, while Jefferies Financial Group Inc. is advising RedLattice. Bold Eagle is led by CEO Eli Baker and co-chairmen Harry Sloan and Jeff Sagansky, who previously led the SPAC that merged with DraftKings in 2019.
So far this year, SPAC sponsors have completed 34 mergers, a stark slowdown from 2021, when roughly 200 blank-check companies finished deals, according to SPAC Research. Data indicate the Eagle Equity Partners team has executed eight SPAC transactions, with stock performance that has tended to be positive. Among outcomes, DraftKings and Target Hospitality Corp. have seen their shares rise to more than twice the $10 IPO level, whereas Ginkgo Bioworks Holdings Inc. is down over 95%, and Skillz Inc. - now rebranded and restructured as Firy Inc. - has produced comparably large losses for long-term investors.
For your money, the setup here is the tell: lots of committed capital, potential trust funds, and a chunky convertible note point to a well-mapped financing. If RedLattice lists, keep an eye on how that funding mix and its government-heavy revenue base shape the market's first take.
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