Estonian drone manufacturer Threod Systems is looking for a new owner. The Ukrainian Armed Forces use their drones for reconnaissance

Threod Systems, an Estonian company specializing in the production of drones, is considering selling its business amid a sharp rise in demand for drones in Europe due to the full-scale war in Ukraine. Bloomberg reports, citing sources familiar with the situation.

• According to them, Threod is already working with consultants to assess interest among potential buyers.

• Possible investors include large European defense companies and private equity funds.

• The company has not yet commented on these plans.

Founded in 2012, Threod Systems increased its revenue by 87% to €38 million in 2024. The company’s customers include Ukraine and seven NATO countries, including the UK, Poland, and Lithuania. The company says that Ukraine regularly uses its reconnaissance drones on the battlefield.

In November 2024, Threod CEO Arno Vaik said that the company plans to reach €100 million in revenue within a few years. The company employs about 160 people.

Threod manufactures fixed-wing drones with vertical takeoff and landing, as well as related systems such as launchers and optics.

In addition, the company has developed its own small electro-optical modules with laser pointers – so-called gimbals – which can be mounted on various types of drones for target detection and targeting.

Growing interest in defense startups

Investors’ interest in European defense startups has grown rapidly amid the changing geopolitical situation and a large-scale European rearmament program.

Under pressure from the Russian president in the East and calls from US President Donald Trump in the West, European countries are preparing to spend trillions of euros on defense. In June, NATO countries agreed to increase defense spending to 5% of GDP after repeatedly criticizing Trump for insufficient security funding. Part of this spending is planned for Ukraine.

Drones, which are generally cheaper than traditional missiles, have become an integral part of the war in Ukraine, helping Kyiv to counter a much larger and more powerful enemy. Russia is also increasingly using long-range drones, launching massive attacks in response to Ukrainian drone strikes on its air bases.

In response, NATO countries are stepping up investments in unmanned systems in an area that has traditionally been dominated by China.

Read more: Tencore, a Ukrainian manufacturer of robotic platforms, has raised almost $4M from MITS Capital