XTI Aircraft and Inpixon enter into definitive merger

Real-time loca­tion sys­tems provider Inpixon last week announced it has entered into a defin­i­tive merg­er agree­ment with XTI Air­craft Com­pa­ny which is devel­op­ing the Tri­Fan 600, a fixed-wing, ver­ti­cal take­off and land­ing (VTOL) air­craft.

The enter­prise val­ue of XTI was ascer­tained by an inde­pen­dent finan­cial advi­so­ry firm to be with­in the range of $252 mil­lion and $343 mil­lion, deter­mined after com­par­i­son with cer­tain pub­lic com­pa­nies with sim­i­lar busi­ness mod­els to XTI in the air travel/VTOL seg­ment of the avi­a­tion indus­try, with an aver­age enter­prise val­ue of approx­i­mate­ly $1.6 bil­lion.

If com­plet­ed, the merg­er will result in a com­bined pub­licly trad­ed com­pa­ny that will focus on advanc­ing the Tri­Fan 600 to mar­ket, as well as con­tin­u­ing to offer Inpixon’s real-time loca­tion sys­tems tech­nol­o­gy to man­u­fac­tur­ing and ware­hous­ing facil­i­ties.

David Brody, founder and chair­man of XTI Air­craft Com­pa­ny, com­ment­ed: “We believe this trans­ac­tion will be a trans­for­ma­tive event for both com­pa­nies and that the Tri­Fan 600 aero­plane will rev­o­lu­tionise point-to-point air trav­el, by com­bin­ing the com­fort, speed, and range of sim­i­lar con­ven­tion­al busi­ness air­craft with the flex­i­bil­i­ty, con­ve­nience, and pin­point trans­porta­tion of a heli­copter.

“In 2019, we suc­cess­ful­ly con­duct­ed mul­ti­ple hov­er tests of our two-thirds scale unmanned proof-of-con­cept con­fig­u­ra­tion of the Tri­Fan. After we close, we expect to be in a strong posi­tion to expand our oper­a­tions, work toward build­ing our first full-scale pilot­ed test air­craft, and con­tin­ue our efforts toward achiev­ing FAA cer­ti­fi­ca­tion and com­mer­cial pro­duc­tion.”

Scott Pomeroy, XTI CFO and board mem­ber, added: “We believe this merg­er, which results in XTI’s list­ing on NASDAQ, is the log­i­cal next step to give XTI access to the broad­er pub­lic cap­i­tal mar­kets fol­low­ing its ear­li­er Reg­u­la­tion CF and Reg­u­la­tion A offer­ings.

“We fur­ther believe that our future cap­i­tal plans are sup­port­ed by the exist­ing strong demand for the Tri­Fan 600, evi­denced by the more than 700 con­di­tion­al pre-orders under a com­bi­na­tion of air­craft pur­chase agree­ments, non-bind­ing reser­va­tion deposit agree­ments, and options.

“These pre-orders rep­re­sent poten­tial gross rev­enues of approx­i­mate­ly $7.1 bil­lion, based on our cur­rent list price of $10 mil­lion per air­craft assum­ing the com­pa­ny is able to exe­cute on the devel­op­ment pro­gram for the Tri­Fan, secure FAA cer­ti­fi­ca­tion, and deliv­er these air­craft.”

Nadir Ali, CEO of Inpixon, con­clud­ed: “We believe that with XTI’s expe­ri­enced exec­u­tive team and the dis­rup­tive poten­tial of the Tri­Fan 600 for the avi­a­tion indus­try, this trans­ac­tion has the poten­tial to unlock val­ue for Inpixon share­hold­ers.

“We antic­i­pate that this trans­ac­tion will not only aid in the growth of XTI but will also enable Inpixon share­hold­ers to own a mean­ing­ful inter­est of approx­i­mate­ly 40% of the out­stand­ing com­mon stock of the com­bined com­pa­ny.”