Polyrizon acquires Arrow Aviation Ltd.

Polyrizon Ltd., a pre-clinical biotechnology firm, has entered into an agreement to acquire a majority stake in Arrow Aviation Ltd., marking its entry into the private aviation sector. The proposed acquisition involves a 51% stake in Arrow for approximately $5.8 million, signified by a non-binding Memorandum of Understanding (MOU). This transaction represents Polyrizon's strategic move to diversify its business portfolio by venturing into a sector expected to reach $41.38 billion by 2030.

Under the MOU terms, Polyrizon plans to invest NIS 18 million for a controlling interest in Arrow Aviation, a company with annual unaudited revenues of around $19 million and an adjusted EBITDA of approximately $3 million. Arrow provides a broad spectrum of private aviation services, including executive jets for VIP flights, specialized transport for the public sector, and the handling of sensitive cargo. Among the notable aspects of the transaction is the transfer of a Hawker 800 aircraft valued at $3.5 million. Additionally, existing debts owed by Arrow's shareholders will be forgiven in return for convertible notes issued by Polyrizon, facilitating Arrow's emergence from institutional debt post-acquisition.

Tomer Izraeli, CEO of Polyrizon, stated that this acquisition is part of Polyrizon's strategy to leverage its financial strength towards generating revenue from high-growth sectors. He emphasized Arrow Aviation's potential and operational excellence as key factors aligning with Polyrizon's diversification and value-enhancement objectives for stakeholders.

The acquisition comes amid shifting dynamics in private aviation, where increasing demand for flexible, private air travel solutions post-pandemic is driving industry growth. By securing a foothold in this sector, Polyrizon positions itself alongside competitors capitalizing on robust demand from both business and leisure clients. As private aviation expands and integrates with technological advancements, Polyrizon's investment signifies a potential for increased capital allocation in similar non-core business opportunities.

A definitive agreement is anticipated within 30 days, contingent upon due diligence completion. The closing follows standard regulatory and operational conditions. Arrow's prospects post-acquisition include potential full ownership by Polyrizon, driven by call and put options on the remaining shares, exercisable after two years linked to financial performance metrics.