Kraken Robotics closes C$615 million Covelya deal and lifts its 2026 revenue outlook to as much as C$320 million

Kraken Robotics said on July 2, 2026 that it had completed its purchase of Covelya Group Limited, the British holding company behind the underwater navigation specialist Sonardyne and four sister brands, for approximately C$615 million before closing adjustments. The transaction, first announced from St. John's, Newfoundland on March 3, turns a Canadian synthetic aperture sonar company with roughly C$100 million of annual revenue into a group that now guides to between C$290 million and C$320 million of sales in 2026.

The price and how it was paid

Kraken paid about C$480 million in cash and issued 15,882,352 common shares at C$8.50 each, worth roughly C$135 million, to the seller, Sonardyne Holdings Limited, according to the company's March 3 and July 2 releases. The seller now owns about 4% of Kraken's issued shares. Those shares are locked up and will be released in three equal tranches 12, 18 and 24 months after closing. Kraken reports all of these amounts in Canadian dollars.

To fund the cash portion, Kraken sold 47,353,550 subscription receipts at C$8.50 on March 12, raising gross proceeds of about C$402.5 million. The offering was launched at C$350 million, or 41,177,000 receipts, with a 15% over-allotment option; the final count equals the base deal plus the full option, by a MEKAWIRE calculation. Scotiabank and Desjardins Capital Markets co-led the syndicate. Each receipt converted into one common share at closing, and the new shares began trading on July 3. On the debt side, the March release described a committed C$150 million secured term facility, while the closing release cited a new C$125 million facility drawn in full plus an increase in Kraken's revolving credit line from C$35 million to C$60 million, extended to March 2031. The closing release does not reconcile the two term facility figures.

What Kraken bought

Kraken said Covelya expected 2025 revenue of between C$249 million and C$275 million and adjusted EBITDA of C$60 million to C$67 million, with nearly 750 employees and 12 facilities across North America, South America, Europe and Asia Pacific. Kraken put Covelya's revenue growth at a 24% compound annual rate since 2023. The operating businesses named at closing are Sonardyne, EIVA, Forcys, Voyis and Chelsea Technologies; the March release also listed Wavefront Systems among the subsidiaries. Sonardyne, founded in 1971, sells acoustic positioning, inertial navigation, communications and monitoring equipment, including its SPRINT-Nav navigation systems and the Ranger 2 USBL positioning family, according to its website. Kraken described EIVA as a software and navigation business, Forcys as subsea services, Voyis as imaging and Chelsea Technologies as environmental monitoring.

Kraken, founded in 2012, built its business on seeing the seabed. Its website lists Kraken SAS, a synthetic aperture sonar that images and maps bathymetry at the same time, the KATFISH towed sonar that operates at up to 10 knots, SeaPower pressure tolerant subsea batteries, and survey services such as LiDAR and sub-bottom imaging. Customers named on the site include NAVSEA, Defence Research and Development Canada, Lockheed Martin, Northrop Grumman, BP, Shell and Equinor. Kraken's preliminary unaudited 2025 revenue was C$102 million to C$104 million, with adjusted EBITDA of C$24 million to C$26 million, the March release said.

On a pro forma 2025 basis, Kraken put the combined group at C$351 million to C$379 million of revenue and C$84 million to C$93 million of adjusted EBITDA, with about 1,200 employees including 790 technical staff. It expected a combined net leverage ratio of approximately 0.8 times at closing, targeted about C$10 million of cost synergies within the first 24 months and forecast low to mid double digit EPS accretion in 2027. The group is organised into defence and commercial business units, with headquarters remaining in Canada.

Guidance and management

With Covelya consolidated from July 2, Kraken raised its 2026 revenue guidance to C$290 million to C$320 million from a stand-alone C$165 million to C$175 million, and adjusted EBITDA guidance to C$65 million to C$75 million from C$40 million to C$50 million. The company said revenue would be weighted toward the second half. Chief executive Greg Reid named Bernard Mills, previously EVP Defence, as President. Covelya's former chairman Simon Partridge became EVP Technology, Sonardyne managing director Graham Brown became EVP Products, Covelya CFO Gary Moynehan became EVP Enterprise Performance, and Kraken CTO David Shea became EVP Strategy and Growth.

Kraken's first report after closing, published on Aug. 27, covered the company on a stand-alone basis. Second quarter revenue rose 4% to C$27.3 million from C$26.4 million, adjusted EBITDA was C$5.0 million and cash stood at C$91.3 million on June 30. Kraken said announced 2026 orders for Kraken and Covelya together reached approximately C$355 million and kept full-year guidance unchanged, including an adjusted EBITDA margin of 22% to 23%.

Where the deal sits among rivals

The combination joins Kraken's imaging and power products with Sonardyne's positioning, navigation and communications gear, the layers an uncrewed underwater vehicle needs to know where it is and to report what it finds. That puts the enlarged Kraken in competition for navy and offshore energy budgets with large diversified suppliers such as Kongsberg, Teledyne and Exail, and alongside a wave of venture backed American entrants. Saronic Technologies, which builds autonomous surface vessels, closed a US$1.75 billion Series D at a US$9.25 billion post-money valuation on March 31, 2026, according to its own announcement.

The risks are the ordinary ones of a large acquisition by a smaller buyer. Kraken must integrate five operating brands across 12 facilities while its own revenue base is less than half of Covelya's. It has not disclosed which jurisdictions reviewed the deal, Covelya's net debt or the size of closing adjustments, and its guidance depends on a second half weighted year.