Mobix Labs Powers Into Aerospace and Defense with Acquisition of SCP Manufacturing

Rhea-AI Summary

Mobix Labs (NASDAQ: MOBX) has announced its acquisition of SCP Manufacturing, a Nevada-based manufacturer of mission-critical electrical components for aerospace, defense, and commercial applications. This marks the company's second strategic acquisition within 60 days, following the November 2024 agreement to acquire Spacecraft Components.

SCP Manufacturing is a key supplier to Spacecraft Components, providing essential products for the U.S. Army's Patriot Missile defense platform, submarines, naval ships, oil rigs, railcars, and metropolitan transit systems. The acquisition is expected to close in Q2 2025 and will be financed through a combination of cash and equity with earnout provisions, subject to final due diligence and board approvals.

This strategic move aims to enhance Mobix Labs' operational efficiency, gross margins, and market position in high-growth industries while creating synergies across multiple sectors.

Positive

• Second strategic acquisition within 60 days demonstrates aggressive growth strategy
• Expands into high-value aerospace and defense markets
• Gains access to mission-critical technologies for military and commercial systems
• Expected to improve operational efficiency and gross margins
• Creates synergies with previously announced Spacecraft Components acquisition

Negative

• Transaction requires cash outlay and potential share dilution through equity component
• Deal completion subject to due diligence and board approvals
• Integration risks of multiple acquisitions in short timeframe

Insights

M&A Analysis Expert

The acquisition of SCP Manufacturing marks a strategic vertical integration play for Mobix Labs, consolidating its supply chain in the aerospace and defense sector. This move is particularly shrewd as SCP is already a key supplier to Spacecraft Components, which Mobix Labs agreed to acquire in November 2024, creating immediate operational synergies.

The deal structure, combining cash, equity and earnout provisions, suggests a carefully crafted approach to risk management and value creation. The earnout component particularly aligns seller interests with future performance, while the mixed payment structure helps preserve cash resources for a company with a market cap of about $42 million.

What makes this acquisition especially significant is its potential to enhance Mobix Labs' position in high-margin defense contracts, particularly through involvement in critical programs like the Patriot Missile defense platform. The vertical integration should lead to improved gross margins through better cost control and streamlined operations.

For investors, this represents a transformation from a components manufacturer into an integrated solutions provider in the aerospace and defense sector. The quick succession of two strategic acquisitions signals an aggressive growth strategy that could reshape the company's market position and financial profile.

Defense Industry Analyst

This acquisition positions Mobix Labs strategically within the defense supply chain ecosystem, particularly in mission-critical systems like the Patriot Missile defense platform and naval systems. The timing is opportune given the increasing global defense spending and modernization initiatives.

The integration of SCP's manufacturing capabilities addresses a important aspect of defense contracting - vertical integration and supply chain security. This is particularly valuable as the defense industry increasingly prioritizes domestic manufacturing capabilities and supply chain resilience.

The deal's significance extends beyond immediate capabilities - it provides Mobix Labs with the necessary credentials and past performance history that are important for winning defense contracts. The company gains access to established relationships with prime contractors and a proven track record in high-reliability applications.

A key strategic advantage is the diversification across multiple defense platforms - from missile defense to submarine systems - reducing dependency on any single program while maximizing growth potential across the defense sector.

~Second Strategic Acquisition in 60 Days Positions Mobix Labs as a Market Leader~

IRVINE, Calif.--(BUSINESS WIRE)-- Mobix Labs, Inc. (Nasdaq: MOBX), a global leader in advanced connectivity solutions, has unveiled another game-changing move with its acquisition of SCP Manufacturing, a Nevada-based producer of mission-critical electrical components for aerospace, defense, and commercial applications. This strategic deal, the company’s second strategic acquisition in just 60 days, is expected to close in Q2 2025 and will amplify Mobix Labs’ operational efficiency, gross margins, and market dominance in high-growth industries.

“Our agreement to acquire SCP Manufacturing underscores Mobix Labs’ determination to redefine the aerospace and defense landscape. With SCP’s engineering and manufacturing capabilities, and a track record of excellence, Mobix Labs gains access to technologies essential for advanced military and commercial systems,” said Fabian Battaglia, CEO of Mobix Labs. SCP is a key supplier of mission critical products to Spacecraft Components, which Mobix Labs agreed to acquire in November 2024.

SCP’s products enable Spacecraft Components to supply critical components for the U.S. Army’s Patriot Missile defense platform, submarines, naval ships, as well as oil rigs, railcars, and major metropolitan transit systems. This acquisition not only strengthens Mobix Labs’ portfolio but also creates unparalleled synergies, enabling streamlined operations and accelerating its growth trajectory across multiple sectors.

Transaction Details

The acquisition will be financed through a mix of cash and equity with earnout provisions, subject to final due diligence and board approvals. Details will be finalized closer to the expected closing date in the second quarter-2025.

About Mobix Labs, Inc.

Based in Irvine, California, Mobix Labs designs, develops and sells components and systems for advanced connectivity solutions, including wireless and wired connectivity, radio frequency (“RF”), and filtering technologies. The Company’s solutions are used in aerospace, defense, 5G, medical, industrial and other high-reliability markets. The Company’s True Xero active optical cables are designed to meet customer needs for high-quality active optical cable solutions at an affordable price. The Company’s electromagnetic filtering products are used in military and aerospace applications. These technologies are designed for large and rapidly growing markets where there are increasing demands for higher-performance communication and filtering systems that utilize an expanding mix of both wireless and connectivity technologies. More information on the company can be found by visiting http://www.mobixlabs.com or by following us on LinkedIn.

Forward-Looking Statements

This press release contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about capturing additional opportunities in the future, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement, such as Mobix Labs’ ability to close the Spacecraft Components and SCP Manufacturing acquisitions pursuant to the terms of any agreement entered into by and between the parties, deliver parts or to develop technology in connection with the systems provided by SCP Manufacturing and Spacecraft Components to its customers. In some cases, forward-looking statements can be identified by words or phrases such as “may,” “will,” “expect,” “anticipate,” “target,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to” or other similar expressions. All information provided in this press release is as of the date of this press release, and Mobix Labs undertakes no duty to update such information, except as required under applicable law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250122262846/en/

Media Contact:

Christopher Lancaster

clancaster@mobixlabs.com

Investor Contact:

Christopher Lancaster

clancaster@mobixlabs.com

http://www.mobixlabs.com

LinkedIn.

Source: Mobix Labs, Inc.

FAQ

When is Mobix Labs' acquisition of SCP Manufacturing expected to close?

The acquisition is expected to close in the second quarter of 2025.

What are the key markets served by SCP Manufacturing's products?

SCP Manufacturing serves aerospace, defense, and commercial markets, specifically providing components for the U.S. Army's Patriot Missile defense platform, submarines, naval ships, oil rigs, railcars, and metropolitan transit systems.

How will MOBX finance the SCP Manufacturing acquisition?

The acquisition will be financed through a combination of cash and equity with earnout provisions, subject to final due diligence and board approvals.

What synergies will the SCP Manufacturing acquisition create for MOBX?

The acquisition will enhance operational efficiency, improve gross margins, and strengthen Mobix Labs' position in high-growth industries, particularly through integration with their recent Spacecraft Components acquisition.

How many strategic acquisitions has MOBX made in the past 60 days?

Mobix Labs has made two strategic acquisitions in 60 days, with SCP Manufacturing being the second following the November 2024 agreement to acquire Spacecraft Components.