Scandinavian Astor Group signs agreement to acquire Latvian ammunition manufacturer AMMUNITY SIA

Scandinavian Astor Group AB (publ) (“Astor Group”, the “Company” or the “Group”) announces today, June 16, 2025, that the Company has entered into an agreement to acquire all shares in the Latvian company AMMUNITY SIA (“Ammunity” or the “Acquisition”), the largest private ammunition manufacturer in the Baltics. In 2024, Ammunity's net sales amounted to SEK 103 million, corresponding to an increase of approximately 80 percent compared to 2023, with an EBITDA margin of 21 percent. The purchase price amounts to EUR 3 million, corresponding to a valuation of SEK 93,8 million on a cash and debt-free basis. The Acquisition is financed with the Company's existing cash. The Acquisition is an important step in the Company's long-term ambition to develop into a comprehensive defense supplier and at the same time strengthens Europe's strategic supply capability of ammunition in a changing security landscape. The Acquisition also marks a key milestone in Astor Group's communicated M&A agenda by realizing the Company's strategy to grow through selective and strategically important acquisitions in the defense and security sector. The Acquisition is subject to regulatory approvals and is therefore expected to be completed no later than December 2025.

”With the acquisition of the profitable niche company Ammunity, we are further contributing to NATO's deterrence and, with ammunition production in northern Europe, we are becoming an even better and broader supplier that can provide more parts in our customers' kill chain. With the acquisition, we are also expanding geographically and reaching the growing Baltic market via Ammunity and contributing to improved Security of Supply of ammunition. I see the latter as part of our responsibility for a safer Europe”, says Mattias Hjorth, CEO of Astor Group.

"Investments of this scale in companies within Latvia's defence sector are a clear confirmation of our industry's competitiveness and potential. The strategic partnership between SIA AMMUNITY and the Scandinavian Astor Group will strengthen our country's ability to ensure the availability of high-quality ammunition for both national needs and also the needs of our allies", states the Minister of Defence of the Republic of Latvia, Andris Sprūds.

The Acquisition
Ammunity, based in Riga, is Latvia's only manufacturer of military small arms ammunition and a leading provider of fine caliber ammunition in the Baltics. The company mainly produces military ammunition with a focus on quality, precision and reliability, and has been classified as a company of national security importance since June 2024. Ammunity works closely with the Latvian Armed Forces and the Latvian government on production and ensuring robust supply chains.

In the autumn of 2024, a new management team took over and restructured, streamlined and ensured good corporate governance in Ammunity, which has generated a sharp increase in sales and earnings and significantly streamlined production. In 2024, Ammunity's net sales amounted to approximately SEK 103 million with an EBITDA margin of 21 percent.

”Building a strong and reliable munitions production capability within Astor Group is not just an industrial investment - it is a contribution to Europe's defense capabilities. We are facing a shift where robustness, speed and security of supply are crucial - and we are now well placed to meet those demands. Together with the Group's other companies, we will now also be able to drive technological innovation in the ammunition and weapon sector within the Group”, says Gabor Nagy, Brigadier General (ret.) and Head of Business Area Astor Protect.

Ammunity has, since 2021, a contract with the Latvian government where orders of approximately SEK 400 million have been placed with the possibility of additional orders where a total value of the contract then would amount to approximately SEK 800 million. In addition, Ammunity has additional requests for ammunition of approximately SEK 360 million. In light of the strong growth and an increasing inflow of customer dialogs and inquiries, Astor Group sees opportunities to increase the annual production. Based on existing contracts and inquiries, Astor Group estimates that strategic production investments over time could provide a capacity increase of six times current annual production capacity. The aim is to develop Ammunity into a key operator in ammunition manufacturing in northern Europe.

Ammunity's business, which currently has 32 full-time employees, will continue as a separate company under its existing name and with the current CEO Beāte Krauze-Čebotare continuing in her role as CEO. Astor Group will, upon closing of the Acquisition, add expertise and access to core cybersecurity and finance functions, improving margins for both Ammunity and Astor Group as a whole.

Main terms and conditions of the Acquisition

• Astor Group acquires all shares in Ammunity for a purchase price of EUR 3 million, corresponding to a valuation of approximately SEK 93,8 million on a cash and debt free basis and financed through existing cash.

• The purchase price, on a cash and debt free basis, corresponds to an EV/EBITDA multiple for 2024 of 4,4x.

• Completion of the Acquisition is subject to customary conditions and also the approval of the Latvian Council of Ministers and the Ministry of Defense. Furthermore, Astor Group shall be given the opportunity for an extended environmental legal investigation of Ammunity's properties, and the Acquisition is conditional upon Astor Group being satisfied with the outcome of the extended investigation. Completion of the Acquisition is expected to occur no later than December 2025.

Background and reasons for the Acquisition
Scandinavian Astor Group is a prominent actor in the defense industry, specializing in delivering high quality products, services and technical solutions primarily in the defense and civil security sector but also in other major industrial segments. The Company, which is divided into three business areas: Astor Industry, Astor Protect and Astor Tech, aims to reflect the Group's strategic focus and strengthen the conditions for organic and acquired growth. Astor Group's objective is to become a leader in each business area. By implementing a multi-business model, Astor Group is diversifying its operations to meet the growing needs of the market. This strategy means that the Group does not focus only on a single business line, which reduces risks and opens up more opportunities for growth and expansion.

Ammunity will be a strategic complement to Astor Group's existing activities in defense, industry and civil protection. The Acquisition is in line with the Group's growth strategy, which aims to build a complete and resilient defense industrial ecosystem within Europe with the overall objective of contributing to NATO's deterrence capabilities. Ammunition is a strategic component of modern defense, where security of supply, technical capability and capacity building have become increasingly important in the changing security environment. As the ammunition market is largely consolidated, this type of acquisition is rare, which further underlines the strategic importance of securing relevant capacity within the Group.

The demand for European-produced ammunition is growing rapidly, both nationally and internationally. By adding a specialist company with an established customer base, proven technology and high delivery capability to the Group, Astor Group creates a new revenue stream with high growth potential and strong relevance for the Armed Forces within NATO.  The Acquisition further strengthens the Group's offering to government agencies and defense customers, while enabling product development and synergies with existing business areas. Astor Group believes that there are good opportunities to further develop Ammunity's offering and increase growth. Ammunity currently has a strong market position in Latvia and by becoming part of Astor Group and the business area Astor Protect, the opportunities for growth and improved results are expected to be further strengthened. Overall, this is an important step in positioning Astor Group as a long-term partner in the defense sector.

Astor Group's financial targets up to and including 2028 are that sales, over time, should increase to at least SEK 2,500 million including acquisitions, and that the operating margin (EBITDA) should amount to at least 15 percent. For the full year 2024, Astor Group had a turnover of approximately SEK 223 million, which corresponds to a turnover increase of 168 percent, of which 44 percent was organic growth. Pro forma revenue in 2024 corresponded to approximately SEK 300 million. The Company has an ambitious acquisition strategy and has identified a large number of reputable acquisition candidates in defense and security. Future development is based on a combination of organic and acquisition-driven growth, which continuously generates a stronger position in the defense sector. The Company plans to establish itself in more prioritized markets with a significant opportunity to grow in each business area.

In summary, the Acquisition is in line with Astor Group's overall strategy to grow both organically and through acquisitions in the most critical segments of the defense industry. By broadening the Group's capabilities, increasing self-sufficiency and entering new markets through high technologically advanced companies - combined with increased product breadth, geographic expansion and potential synergies - conditions are created for scalability and long-term value-creating growth, where this Acquisition is expected to contribute positively to the Company's development.

Advisors and other information
Eversheds Sutherland Advokatbyrå is acting as legal advisor to the Company in connection with the Acquisition. Sorainen is acting as legal advisor and Superia as financial advisor to the sellers of Ammunity in connection with the Acquisition.

More about AMMUNITY
Ammunity, headquartered in Riga, is Latvia's only manufacturer of military ammunition and a leading player in fine caliber ammunition in the Baltics. The company produces ammunition with a focus on high quality, precision and reliability, and since June 2024 has been classified as a company of national security importance, working closely with the Latvian Armed Forces.

For further information, please contact:
Scandinavian Astor Group’s CEO Mattias Hjorth
E-mail: [email protected]

This information is information that Scandinavian Astor Group AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation 596/2014. The information was submitted for publication, through the agency of the contact person set out above, at the time specified by Astor Group's news distributor at the time of publication of this press release.

Please note that this is an English translation of a press release written in Swedish by Scandinavian Astor Group AB (publ), in the event of any inaccuracies, the Swedish version applies.

About Scandinavian Astor Group AB (publ)
Scandinavian Astor Group is a Swedish defense group shaping the future of security and protection. Through its three business areas - Astor Tech, Astor Industry and Astor Protect - the Group delivers advanced technology, high-quality components and critical security solutions to primarily the defense, industry and public safety sectors. Astor Group is listed on NGM Nordic SME (ticker: ASTOR) and Boerse Stuttgart. The Company is headquartered in Stockholm, Sweden. Shark Communication AB, tel. +46 73-434 45 15, e-mail: [email protected] is the Company's Mentor. For more information about Astor Group's business, visit: www.astorgroup.se