The Electro Optic Systems Holdings Ltd (ASX: EOS) share price is up more than 4% after announcing a new MARSS contract.
The company operates two divisions – defence systems and space systems. Its defence systems specialise in technology for weapon systems optimisation and integration, as well as intelligence, surveillance and reconnaissance, and C4 systems for land warfare.
Its space systems apply EOS-developed optical sensors and effectors to detect, track and ‘characterise’ objects in space.
MARSS business update
EOS is currently in the process of acquiring MARSS, which is a provider of counter-drone systems, including custom design of high-performance systems incorporating third-party OEM equipment such as sensors and effectors.
MARSS secured new orders in May 2026 totalling €102 million (A$165 million) from an existing customer in the Middle East.
MARSS’ NiDAR Command and Control (C2) systems are used to detect, track and defeat drone attacks. In the Middle East, the NiDAR system has successfully protected critical target infrastructure.
Multiple attacks by Shahed drones and missiles have been defeated and customers have been defeated and customers have expressed “deep satisfaction”. MARSS is seeing “accelerated customer enquiry” and interest in its integrated and turn-key counter-drone capabilities.
The contract announced today is with the national defence force of a country in the Middle East. The contract expands MARSS’ existing installations to deliver a country-wide drone detection and mitigation capability.
Subject to the acquisition completing, the addition of MARSS’ $217 million order book to EOS’ existing $509 million order book would increase EOS’ total order book to $726 million.
EOS noted that in addition to the current order book, MARSS has several additional potential future opportunities with contract values exceeding $100 million.
Amended transaction terms
EOS said that due to increased customer enquiries and MARSS’ established footprint, it has increased the likelihood and size of contracts that could be signed during the earn out period and therefore increased the value of MARSS, though there’s no guarantee of further contract signings.
This progress has led to certain amendments to the transaction terms previously announced on 12 January 2026.
The upfront consideration of US$36 million on completion remains unchanged.
The maximum earnout cap will be increased to €140 million, up from €100 million.
EOS announced that it has drawn A$70 million of its secured term loan facility. A$50 million of the drawdown will be used to fund the upfront cash consideration
Final thoughts on the EOS share price
The business is making the right moves to grow and become a much larger position in the industry.
It has done a good job at winning contracts and this acquisition could help the business grow further.
I’m not sure if it’s a great buy today without a crystal ball to see how many more contracts it can win – valuation is important to make sure we don’t overpay. But, I think it’s one of the ASX growth shares to watch.
