Rafael selling 50% of electro-optics subsidiary Controp at over $600M valuation
American drone maker AeroVironment is leading negotiations in a deal valuing Controp at up to $1 billion.
Rafael is close to selling 50% of its shares in its subsidiary, Controp. Calcalist has learned that the deal values Controp at $600–700 million, though the final valuation could be higher. Rafael is aiming for a valuation of $1 billion or more.
The sale process is being led by Rothschild & Co., a foreign investment bank hired by Controp’s board of directors. The most advanced negotiations are with U.S.-based AeroVironment, a defense company listed in New York with a market capitalization of $12.5 billion. Sources say AeroVironment is currently the leading contender, though other parties remain interested.
Rafael currently owns 100% of Aeronautics which holds all of Controp. Rafael and businessman Avihai Stolero bought Aeronautics together in 2019, and Rafael later acquired Stolero’s share for 487 million shekels ($130 million), making Aeronautics and Controp government-owned companies.
Controp, founded in 1998 by former Air Force and Israel Aerospace Industries engineers Shlomo Nir, Sasson Bendo, Eli Ben-Aharon and Yehezkel Ambar, develops electro-optical and precision motion systems used for military missions and border defense. Its cameras and sensors are deployed mainly on drones but also on helicopters, light aircraft, patrol boats and observation towers.
Based in Hod Hasharon, Controp employs about 400 people and reported record 2024 revenues of $150 million, up from $115 million a year earlier. Net profit jumped to $8 million from $2.5 million. The company expects net profit of about $25 million in 2025.
Controp has been without a permanent chief executive since Hagay Azani resigned to head medical equipment maker Tuttnauer owned by Fortissimo Capital. The board is chaired by former minister Yuval Steinitz.
Related articles:
The planned sale is intended to remove Controp from the constraints of being state-owned, which executives say limit flexibility in salaries, stock options and decision-making in a competitive private market. Once Rafael’s stake is reduced to 50%, Controp will no longer be classified as a government company.
Alongside the sale, Controp is preparing to float its subsidiary MicroCon Vision Ltd. on the Tel Aviv Stock Exchange at a valuation of 300–400 million shekels. MicroCon, led by CEO Chen Almog and general counsel Lihee Wider, develops miniature electro-optical cameras and aims to compete with publicly traded Next Vision. Shareholders include Poalim Equity and Stolero. Controp also owns EasyViz, acquired with Magal Security Systems from FIMI Opportunity Fund.
Controp is relocating to a new campus in Neve Yamin being developed by Mega Or and Stolero.
AeroVironment, based in Virginia and led by CEO Wahid Nawabi, is a major supplier of drones to the U.S. military. It reported revenues of $820 million for the year ending April 2025, up from $720 million a year earlier, with net profit of $43 million.
Rafael confirmed the sale effort, saying: “Since Controp became a government-owned company in September 2023, the board of directors of Rafael decided in principle to find a partner for the company and sell 50% of its shares. Rafael is working to implement this decision.”
