Shares of Kraken Robotics slid 7.9% to $3.83 on June 30, falling sharply from $4.33 just a week earlier, as traders took profits and repositioned ahead of the company's largest-ever acquisition. The deal — a $615 million takeover of UK-based Covelya Group — is expected to close on July 2, 2026 , and the proximity of that date is forcing investors to decide now whether the transformed company is worth owning.
A Company Three Times Kraken's Size Is About to Be Absorbed. Covelya generated between $249 million and $275 million in 2025 revenue, and the combined entity is projected to produce roughly $365 million with a 24% adjusted EBITDA margin (a measure of operating cash profit). By comparison, Kraken on its own posted just $102–$104 million in 2025 revenue. That means Kraken is swallowing a target roughly three times its size — a bold move that amplifies both growth potential and integration risk.
The Financing Mix Is What Spooks Some Holders. Under the deal, $480 million is paid in cash and $135 million through newly issued Kraken shares.
The cash portion is funded by a $150 million secured loan and a $350 million public offering of subscription receipts — essentially IOUs that convert into shares once the deal closes. That flood of new stock dilutes existing shareholders. At the recent shareholder meeting, roughly 133.6 million common shares were represented , so the equity issuance meaningfully expands the share count.
The Strategic Logic Is Strong — If Execution Follows. Management projects roughly $10 million in cost savings within 24 months.
The deal is described as immediately adding to earnings per share, with low-to-mid double-digit EPS growth expected in 2027.
Combining Kraken's sonar sensors and deep-sea batteries with Covelya's navigation, positioning, and communications systems creates a broader product suite targeting the booming NATO undersea defence market.
Profit-Taking, Not Panic. Broader indices were flat Monday, isolating this as a stock-specific move. Kraken's gross profit margin reached 62% in 2025, up from 49% in 2024 , and cash flow from operations turned positive for the first time last year. No new negative surprise has surfaced. The selloff looks like classic pre-close jitters — investors locking in gains from a stock that tripled since late 2024, unwilling to ride through the uncertainty of a deal this transformative closing in 48 hours.