Vance Street builds out defense tech platform, closes first add-on

The PE firm embarks on a buy and build strategy with Spectra A&D, an aerospace and defense holding company.

Vance Street Capital has bagged Galleon Embedded Computing, a solutions provider to the military. This will extend capabilities for its newly launched defense electronics manufacturer, Spectra A&D Holding.

Oslo, Norway-based Galleon marks the first add-on for Spectra A&D, formed in February through the simultaneous acquisition of three US-based aerospace and defense suppliers: Calculex, Argon Corporation and FDS Avionics.

Vance Street’s goal with Spectra was to create a platform that could provide an array of data capture products used in military aircraft. The proprietary products are able to record, process, route and ultimately display mission-critical data. “We formed Spectra with the clear strategy and directive that this was going to be buy and build,” said Nic Janneck, principal at Vance Steet.

The firm is following a data acquisition mode with Spectra. This essentially means that the add-ons should have capabilities to process data in a variety of stages – either initial data capture, data processing and routing or data recording and displaying.

The deal, which closed a week ago, extends the data processing and recording capabilities of the platform. The LOI was signed 45 days before closing.

Founded in 2009, Galleon was sold through an auction, and the process began in March. Vance Street, at the time, wasn’t specifically hunting for a European asset. The deal structure included debt and equity deployed from the firm’s $375 million fund III. Los Angeles-based Vance Street typically makes investments of $30 million to $250 million.

Prior to Spectra’s formation, the firm owned another defense electronics company called Secure Technology Company, which was sold to Benchmark, a strategic for approximately $230 million in cash in 2015.

Leveraging its expertise in the space, Vance Street will invest in the engineering and manufacturing operations of Galleon. The server and data recorder manufacturer will retain its brand identity while being a part of the larger holding company.