Defense technology firm Space-Eyes is set to go public through a merger with special purpose acquisition company (SPAC) McKinley Acquisition Corp, in a deal that values the combined entity at $638 million.

President Donald Trump's son Eric Trump recently became the third-largest private investor in the original Space-Eyes, which has operated primarily as a research-and-development company and generated about $1 million in annual revenue, people familiar with the matter told Reuters.

Following the transaction, Eric Trump will assume a role as a strategic adviser to the newly combined business, having also assisted in introducing potential board candidates.

"The technology Space-Eyes is developing is absolutely critical for the safety of our nation," Eric Trump stated in a press release. "I am proud to be part of this important mission."

The Miami-based company specializes in developing AI-powered counter-drone and geospatial intelligence technologies, primarily for governments and various agencies.

While Space-Eyes has largely focused on technology development, it plans to significantly scale its operations by utilizing third-party manufacturers, sources told Reuters. This strategy aims to facilitate expansion into government contracts across different continents and attract corporate clients, ranging from cruise companies to data centers. The investment thesis for the merger is predicated on anticipated contract growth rather than its current revenue streams.

The company is negotiating contracts worth around $35 million over five years, compared with the company’s current contracts that are typically valued annually at $300,000 to $400,000, Reuters reported. These potential agreements could involve monitoring drug trafficking in the Caribbean, defense applications in the Middle East, or preventing drone-borne contraband from entering US prisons.

In his advisory capacity, Eric Trump is expected to offer guidance on security threats posed by drones and other emerging technologies, drawing on his experience with security issues surrounding the White House.

Space-Eyes Chief Operating Officer Dylan Monroe noted, "He is giving us an understanding of some risk factors such as being stuck at the White House with drones overhead, or these attempted attacks on the presidential office," referring to security threats to President Trump.

McKinley CEO Peter Wright added that Eric Trump has provided valuable introductions, identified opportunities, and will contribute crucial intelligence as an adviser. "

The administration finds out that drugs are getting smuggled into prisons, and it's happening via drone," Wright said. "Giving that as a problem for us to go solve is what a strategic adviser does."

The transaction is projected to generate up to $251.7 million in gross proceeds, encompassing capital held in McKinley's trust account and a planned private investment in public equity (PIPE) financing. This deal underscores a growing investor interest in defense technology companies as global governments increase spending on drone detection, autonomous systems, and AI-driven battlefield intelligence.

Space-Eyes' operational model draws inspiration from software and data analytics providers like Palantir, a significant US government contractor known for its high adjusted operating margins. Space-Eyes positions itself as a software and systems company that integrates data from satellites, radar, radio-frequency sensors, and other sources to detect, track, and respond to drone threats, while also delivering real-time geospatial intelligence. Its product portfolio includes SeaWatch, a maritime intelligence platform, and Morpheus, an AI-driven counter-drone system.

Special purpose acquisition companies, or SPACs, are shell companies that raise capital through an initial public offering to merge with and take a private company public. SPACs have seen a decline in popularity since their boom between 2020 and 2022, as many companies that went public via these vehicles struggled to meet growth projections post-listing.

The merger is anticipated to conclude in the fourth quarter of 2026, pending shareholder and regulatory approvals. The combined company is slated to trade on the Nasdaq exchange under the ticker symbol "CUAS," an acronym for counter-unmanned aerial systems.

Space-Eyes, founded two decades ago by CEO Jatin Bains, announced in January its plans to open a Washington office to strengthen government partnerships and support federal contracting activities.