Defence engineering company KTEK Systems has completed an oversubscribed Seed Round, raising $2.5 million as it prepares for an initial public offering planned for early 2026.
The capital raise exceeded the company’s original $1.5 million target and attracted investment from Australian small-cap funds, sophisticated investors, family offices and high-net-worth individuals. A cornerstone investment was made by the Regal Emerging Companies Fund.
KTEK, which supplies turnkey sub-assemblies and composite airframes for military unmanned aerial vehicles, completed the Seed Round via a convertible note that will convert at a fixed price of 10 cents. This represents a 50 per cent discount to the company’s planned 20 cent IPO price, with the company targeting an ASX listing in the first quarter of 2026.
Funds raised will be used to expand KTEK’s global production capacity, further develop its “Cordless Factory” manufacturing platform and support IPO readiness activities. The company also plans to enter into an exclusive option agreement to acquire KTEK Ltd in full at the time of listing, consolidating its global operations.
The raise comes amid strong growth in global UAV procurement, driven by rapid innovation, AI-enabled autonomy and increased defence demand. KTEK positions itself as a “picks-and-shovels” supplier to Tier-1 and Tier-2 original equipment manufacturers across multiple UAV platforms and mission-critical systems.
Founded in 2019 by former Israel Aerospace Industries executive Dekel Keisar, KTEK operates an asset-light manufacturing model that combines in-house engineering and quality control with certified production partners across Israel, Europe and other regions.
Keisar said the Seed Round marked a turning point for the company.
“We are extremely pleased with the depth and quality of support received in this Seed Round. The oversubscription reflects strong conviction in our technology, our operating model, and the strategic role KTEK plays within the global UAV supply chain,” he said.
“The global defence market is undergoing a generational shift. Demand for UAV systems is accelerating rapidly, and KTEK is uniquely positioned to scale with our customers as they expand production capacity worldwide.”
Nathan Barbarich, lead manager and corporate adviser at CPS Capital, said investor demand highlighted both the opportunity and the timing of the raise.
“KTEK is one of the most compelling early-stage defence engineering opportunities we have seen,” Barbarich said. “The success of the Seed Round highlights both the strength of the team and the scale of the opportunity ahead.”
CPS Capital will act as lead manager and corporate adviser for both the Seed Round and the upcoming IPO.
