Defense and space startups turn to SPAC mergers

Early-stage defense and space companies are increasingly using SPAC mergers to go public faster. Surging investor interest and higher defense budgets are driving the trend.

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Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., September 8, 2026.  REUTERS/Brendan McDermid

Early-stage defense and space firms are accelerating backdoor listings through SPAC mergers this year, securing $2.35B in trust amid surging investor appetite. The trend offers flexible capital and faster market entry than traditional IPOs for companies with government contracts. The shift comes as the United States military budget scales up to $1.5 trillion for 2027.

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