Elroy Air, Inc. has entered into a definitive business combination agreement with Columbus Circle Capital Corp II, a special purpose acquisition company led by the management team of Inflection Point Asset Management and Cohen & Company, Inc., to become a publicly traded company. The transaction values Elroy Air at a pre-money equity value of $800 million and a post-transaction enterprise value of approximately $1.0 billion. This merger provides the drone startup with significant capital to scale its autonomous heavy-cargo aircraft operations for defense and commercial markets.

The proposed transaction is expected to close in the fourth quarter of 2026, subject to regulatory and shareholder approvals. It includes more than $165 million in committed private investment in public equity (PIPE) capital, anchored by Inflection Point, existing Elroy Air investors, and new institutional investors. The proceeds are expected to fully fund commercial scale production of the Chaparral aircraft system, with U.S. manufacturing partner Kratos Defense & Security Solutions. Notably, $65 million of the PIPE is funding in connection with the execution of the business combination agreement.

Strategic and Operational Highlights

Elroy Air specializes in vertical take-off and landing (VTOL) aircraft designed for middle-mile logistics. The Chaparral aircraft features a hybrid-electric powertrain capable of carrying 500+ pounds of cargo with a range of up to 450 miles. The company reports a demand pipeline exceeding 1,400 aircraft and over $5 billion in potential estimated revenue opportunity from leading logistics and aviation companies, including Bristow Group, Barq Group, SLI, and FedEx.

The company has established a manufacturing partnership with Kratos Defense & Security Solutions as the exclusive U.S. manufacturer of the Chaparral, with first production aircraft planned for late 2026. Additionally, Elroy Air signed a $200 million joint venture initial agreement with Barq Group to establish an international manufacturing facility in Abu Dhabi, with initial flight operations in the UAE planned for 2027 and local production in 2028.

Transaction Details

The Boards of Directors of both Elroy Air and Columbus Circle Capital Corp II have unanimously approved the transaction. Upon closing, the combined company will retain the Elroy Air name and expects to be listed on the Nasdaq under the ticker symbol "ELRY". Barclays is acting as the exclusive financial advisor and capital markets advisor to Elroy Air.