Eric Trump, Executive Vice President of The Trump Organization and son of U.S. President Donald Trump, speaks to Reuters during an interview in Riyadh, Saudi Arabia, January 11, 2026. REUTERS/Hamad I Mohammed/File Photo
NEW YORK, July 31 (Reuters) - Defense technology company Space-Eyes has agreed to go public through a merger with special purpose acquisition company McKinley Acquisition Corp, in a deal valuing the combined business at $638 million, according to four people familiar with the matter.
President Donald Trump's son Eric Trump has recently become the third-largest private investor in the original Space-Eyes, which has operated primarily as a research-and-development company and generated about $1 million in annual revenue, the people said.
Eric Trump will serve as a strategic adviser to the combined business following the transaction, the people said, adding he helped introduce potential board candidates to the new public company.
Representatives for Eric Trump did not respond to a request for comment.
The Miami-based company develops artificial intelligence-powered counter-drone and geospatial intelligence technologies for governments and agencies.
While it is so far mostly a technology developer, it plans to scale up the business using third-party manufacturers, allowing it to expand into government contracts in different continents and into corporate clients, from cruise companies to data centers, the people said.
The investment thesis is based on expected contract growth rather than existing revenue, the people said.
The company is currently negotiating contracts worth around $35 million over a period of five years, compared with the company’s current awards that are typically valued annually at $300,000 to $400,000, the people said.
Those could include monitoring drug trafficking in the Caribbean, defense applications in the Middle East or preventing drone-borne contraband from entering U.S. prisons, the people said.
As part of his new role, Eric Trump is expected to advise the company on security threats posed by drones and other emerging technologies, drawing on his experience with security issues surrounding the White House.
"He is an important adviser that connects us to people and opportunities, and he is an adviser that brings the intelligence," one of the people said.
The transaction is expected to provide up to $251.7 million in gross proceeds, including capital held in McKinley's trust account and a planned private investment in public equity, or PIPE, financing, the people said.
The deal reflects growing investor interest in defense technology companies as governments worldwide increase spending on drone detection, autonomous systems and AI-driven battlefield intelligence.
Space-Eyes' model is inspired by software and data analytics providers such as Palantir, the people said. Palantir, a major U.S. government contractor, reported an adjusted operating margin of 60% in the first quarter, compared with the single-digit margins typical of traditional defense hardware contractors.
Space-Eyes defines itself as software and systems company that combines data from satellites, radar, radio-frequency sensors and other sources to detect, track and respond to drone threats and deliver real-time geospatial intelligence.
Its products include SeaWatch, a maritime intelligence platform that tracks vessels using satellite and sensor data, and Morpheus, an AI-driven counter-drone system designed to detect and mitigate unmanned aerial threats.
Special purpose acquisition companies, or SPACs, are shell companies that raise money through an IPO to merge with a private company and take it public. SPACs have largely lost favor since the 2020-2022 boom, as many companies that went public through the vehicles struggled to meet growth projections after listing.
The deal is expected to close in the fourth quarter of 2026, subject to shareholder and regulatory approvals, with the combined company expected to trade on the Nasdaq exchange under the ticker symbol "CUAS", a reference to counter-unmanned aerial systems.
Space-Eyes, led by founder and Chief Executive Officer Jatin Bains and Chief Operating Officer Dylan Monroe, disclosed in January that it was opening an office in Washington to deepen government partnerships and support federal contracting activities.
Reporting by Echo Wang and Sabrina Valle; Editing by Lincoln Feast.
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