Kraken Sonar Secures Partnership with Elbit Systems in Israel

Big news this morning out of Kraken Sonar (PNG.V). Per my original investment thesis and subsequent updates, something like this was fairly predictable, so I am glad to see that my investment thesis is tracking nicely. 

This news is a huge validation for Kraken Sonar and its $1.5M KATFISH product. Elbit Systems is a $3B+ Defense Contractor located in Israel. The fact that Elbit is looking to the little Canadian-based company of Kraken Sonar, instead of internally within Israel where some of the world's best technology for defense systems is located, speaks volumes for Kraken Sonar. 

Now we need to pay attention to Elbit as orders that they receive from a bidding process with government entities for Unmanned Underwater Vehicles (UUVs) will flow through to Kraken for the $1.5M KATFISH product.

A few highlights from the press release:
(source: Sophic Capital email regarding the Press Release)

  • Kraken is supplying leading Israeli defense contractor Elbit Systems (ESLT-NASDAQ) with its KATFISH towed sonar system.
  • KATFISH is an actively controlled, intelligent towfish for real-time ultra-high resolution seabed mapping system and when announced in July, 2015 had a sales price of US$1.5 million.
  • Technology now validated by leading contractor and will be included on Elbit’s state-of-the-art Unmanned Surface Vehicle (USV) the Seagull. 
  • Elbit’s Seagull could be the world’s first unmanned system for anti-submarine warfare missions
  • Validates two, non-dilutive government grants totaling $1.25 million that Kraken recently received for KATFISH development
  • Two Seagulls could perform an anti-sub warfare mission equivalent to a frigate and its dozens of crew members. Validation that lives matter and the transition to machines to undertake the most dangerous and dirty work in the sea – the world’s most hostile environment.
  • Saving assets with naval mine detection. A vintage World War I mine used by Iran almost sunk the frigate USS Samuel B. Roberts on April 14, 1988.  Kraken’s revolutionary sonar is especially well-suited for military mine hunting missions.