LEONARDO DRS ACQUIRES RAFT FOR $450 MILLION IN ALL-CASH TRANSACTION

Leonardo DRS, the US-listed subsidiary in which Leonardo holds a 71.38% stake, has signed a definitive agreement to acquire Raft in an all-cash transaction valued at $450 million. The acquisition adds open-architecture software and artificial intelligence capabilities to the Leonardo Group’s portfolio in support of integrated mission solutions. Founded in 2018, Raft provides open-architecture mission software specialising in multi-domain data fusion and artificial intelligence, supporting real-time situational awareness and faster operational decision-making for customers.

Lorenzo Mariani, Leonardo Chief Executive Officer and General Manager, said the acquisition was aligned with the strategy of both Leonardo and Leonardo DRS, and enhanced Leonardo DRS’s ability to deliver integrated, mission-focused technologies that help customers operate with greater speed, clarity and confidence in complex operational environments. He described Raft’s open-architecture software, AI and data integration capabilities as highly complementary and additive to Leonardo DRS’s existing technology portfolio. The transaction is subject to regulatory approvals and customary closing conditions and is expected to close in the fourth quarter of 2026, funded through cash on hand and borrowings under Leonardo DRS’s revolving credit facility.

WHY OPEN ARCHITECTURE IS THE OPERATIVE TERM

The emphasis on open architecture is the most commercially significant aspect of the acquisition. Defence software has historically been delivered as closed, platform-specific systems, tightly coupled to particular hardware and difficult to update without vendor involvement — an arrangement that has served incumbent suppliers well but has left militaries unable to integrate new capabilities at the pace that current operational environments demand. Open-architecture mission software is designed to be modular and interoperable, allowing components to be replaced or upgraded independently and permitting data from multiple sensors, platforms and domains to be fused into a single operational picture.

For a company whose established strength lies in hardware — sensors, electronics, electro-optical systems and computing — acquiring a software house founded in 2018 rather than building the capability internally reflects a judgement about time to market. Raft’s multi-domain data fusion and AI capabilities are precisely the layer that converts a portfolio of individually capable sensors into an integrated mission system, and that integration layer is increasingly where the value in defence procurement is concentrated.

DIGITAL HORIZON: MICROSOFT 365 AND COPILOT ACROSS 50,000 EMPLOYEES

Separately, Leonardo has announced the launch of Digital Horizon, an internal digital transformation programme developed in partnership with Microsoft Italia. Formally titled ‘Digital Horizon — A New Era of Collaboration with Microsoft 365’, the programme provides approximately 50,000 people across the Group with the Microsoft Teams platform, enabling real-time collaboration and remote working through synchronisation of documents and communications via Microsoft OneDrive and Outlook in the Microsoft cloud. Individuals and teams will have access to an AI assistant integrated into the corporate context, leveraging Microsoft 365 Copilot to support the creation, analysis and synthesis of content within what Leonardo describes as a secure and trusted environment.

The training component is given equal weight to the technology. The programme supports employees through short training modules, guidelines and support tools including a ‘When to Use What’ smart compass, alongside instruction in advanced prompting strategies and an introduction to AI agents. A distributed network of colleagues designated ‘Digital Pioneers’ supports adoption of the new tools and the development of best practices to be shared across the company.

Antonio Liotti, Chief People & Organization Officer at Leonardo, said the decision to launch Digital Horizon stemmed from the need to make internal ways of working more connected and integrated, with the new tools and artificial intelligence fostering collaboration, information sharing and innovation while reducing time spent on repetitive tasks and allowing people to focus on higher-value work. He said training played a central role not only in imparting the necessary skills but in guiding people through the cultural shift in approach. Marco Fischetto, Director of the Public Administration Division at Microsoft Italia, said the company was supporting Leonardo in accelerating innovation, productivity and collaboration in line with the Group’s high standards for security and information protection, and noted that technology was only part of the innovation journey — to generate real value it had to be accompanied by skills development and a culture of informed adoption.

TWO DIRECTIONS OF TRAVEL

Announced within days of one another, the two initiatives describe a coherent position. The Raft acquisition is Leonardo buying AI and data fusion capability to embed in products sold to defence customers. Digital Horizon is Leonardo deploying commercial AI tooling into its own 50,000-person workforce. The former addresses competitiveness in the market; the latter addresses productivity and the speed at which the organisation itself can operate. For a group that recently completed its transition to the ISO 37001:2025 anti-bribery standard with explicit attention to conflicts of interest, the emphasis in the Microsoft partnership on security, information protection and a trusted environment is consistent with a broader institutional focus on governance around new systems.