KWESST (TSX-V:KWE, OTCQB:KWEMF) Micro Systems Inc. has announced several favorable developments regarding the introduction to market of its Phantom electronic battlefield decoy.
Phantom is a programmable radio frequency (RF) generator that can mimic the electronic communications of NATO forces, thus fooling adversaries as to their location.
Phantom also provides the ability to see radio frequency energy of both adversaries and friendly forces and gives the user a high-fidelity planning capability for optimal placement for maximum effectiveness. Finally, Phantom provides a training function that allows NATO forces to "practice" operating in Electronic Warfare (EW) environments.
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As part of discussions with large defense contractors, KWESST said it is in advanced negotiations with a global defense contractor to provide Phantom units as part of the contractor's tender for armored vehicles to a large NATO customer.
Inclusion of an electronic battlefield decoy technology, like KWESST's Phantom, on the vehicles was requested by the NATO customer as part of the tender.
The company noted that should the defense contractor win the tender, it is expected that the accompanying requirement for Phantom will result in a contract worth more than US$40 million for KWESST, depending on the number of vehicles purchased, with initial revenue in the current fiscal year and ramping up in 2023 and 2024.
In addition, KWESST said the US Department of Defense (DoD) has requested a showcase demonstration of Phantom at its upcoming signature, invitation-only event "Silent Swarm 22" next summer (2022) for advanced Electro Magnetic Spectrum Operations (EMSO).
In July 2021, Phantom was showcased by invitation only to a US Special Operations Command (USSOCOM) technical exercise, where KWESST designers and engineers engaged with the Special Operations community in a collaborative environment.
The company said this led directly to discussions and negotiations with three large defense contractors regarding potential go-to-market partnerships across a variety of rapidly emerging requirements and programs for electronic decoys.
The US DoD also expressed interest in an additional, small, disposable version of Phantom for use by Special Forces, pursuant to which KWESST has developed a concept model.
"Together, these developments mean significant growing interest in the Phantom product suite and multiple pathways to market," said KWESST CEO Jeff MacLeod in a statement. "Initial sales are expected in the first quarter of our current fiscal year ending December 31. Based on internal research and customer discussions, the company estimates the market for a system like Phantom to be worth several hundred million dollars in the U.S. alone."
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