Dragonfly Energy Announces Strategic Acquisition of Dakota Lithium Assets
Key Highlights of the Acquisition
- Capital-Efficient Deal Structure: Dragonfly Energy Holdings Corp. (Nasdaq: DFLI) has completed the acquisition of substantially all operating assets of the Dakota Lithium® brand for a total consideration of \$4 million. The deal includes \$1 million in cash and \$3 million in Dragonfly Energy common stock valued at \$2.00 per share—a premium over recent trading levels. The equity portion is subject to a 12-month lock-up, a notable sign of confidence from both parties.
- Expansion into New Markets: This acquisition significantly expands Dragonfly Energy’s reach into the marine, outdoor recreation, powersports, golf cart, and other specialty battery markets. Dakota Lithium is a recognized brand in lithium iron phosphate batteries, with established distributor and customer relationships.
- Immediate and Long-Term Financial Impact: Dakota Lithium generated approximately \$12 million in net revenue in 2025, despite significant working-capital and inventory constraints that limited product availability. Dragonfly Energy expects the acquired business to begin contributing meaningful revenue and to be accretive to Adjusted EBITDA in the fourth quarter of 2026.
- Synergy and Integration Strategy: The company intends to operate Dakota Lithium as a distinct brand alongside its existing Battle Born Batteries® line. The multi-brand strategy is designed to broaden product offerings, capture additional customer segments and price points, and leverage Dragonfly’s existing commercial, operational, fulfillment, and customer-support infrastructure—without a proportional increase in fixed overhead.
- Financial Flexibility via Lender Amendments: Concurrent with the acquisition, Dragonfly Energy’s lenders have amended certain terms of their debt arrangements. These include reducing the company’s minimum cash covenant and allowing interest to be paid in kind (PIK) for the next quarters, preserving approximately \$1 million in near-term liquidity and boosting financial flexibility.
Details and Strategic Rationale
Dakota Lithium’s assets include the brand, intellectual property, product inventory, a complementary battery portfolio, and established distribution channels. The acquisition comes after Dakota Lithium saw its revenues drop to \$12 million in 2025 due to working-capital and inventory constraints—below levels seen in prior years. Dragonfly Energy believes that by integrating Dakota Lithium into its existing infrastructure, it can restore product availability, support existing customers, and efficiently grow the business.
Notably, Dragonfly plans to maintain Dakota Lithium as a standalone brand, leveraging its brand equity while using Dragonfly’s resources to drive operational improvements and revenue growth. The company’s multi-brand approach is expected to allow Dragonfly to reach new market segments and offer a wider range of products.
The transaction structure—requiring only \$1 million in cash and 1.5 million shares issued at a premium price—minimizes upfront cash outlay and preserves liquidity during the integration process.
Shareholder-Relevant and Price-Sensitive Points
- Accretive Acquisition: Dragonfly expects the acquisition to add to Adjusted EBITDA starting Q4 2026. This will likely be viewed as a positive catalyst by investors focused on profitability.
- Equity Issuance at a Premium: Shares were issued at \$2.00 per share, higher than recent trading levels, which may signal management’s confidence in Dragonfly’s intrinsic value.
- Lender Support and Improved Liquidity: The amendments from lenders reduce immediate cash requirements and provide added flexibility, reducing financial risk for the near term.
- Multi-Brand Strategy: Operating Dakota Lithium alongside Battle Born Batteries® is aimed at broadening market share and product reach, which could drive future revenue growth.
- Potential for Revenue Rebound: Restoring Dakota Lithium’s product availability may enable the brand to return to or exceed prior revenue levels.
Other Important Information
- Legal and Regulatory Notes: The issued shares were offered under Section 4(a)(2) of the Securities Act of 1933 and are subject to restrictions on resale for 12 months.
- Advisory Role: The transaction was facilitated by an affiliate of Resolution Financial Advisors LLC, a specialty advisory firm.
- Forward-Looking Statements: Management cautions that statements regarding future integration, financial contribution, and strategy are forward-looking and subject to various risks and uncertainties, as detailed in Dragonfly’s filings with the SEC.
About Dragonfly Energy
Dragonfly Energy Holdings Corp. is an industry leader in lithium battery technology, spanning battery cell manufacturing, pack assembly, and full-system integration. The company is advancing next-generation battery technologies, including all-solid-state battery cells, and focuses on solutions for mobile, off-grid, industrial, and specialty applications.
Investor and Media Contacts
- Investor Relations: Eric Prouty, Szymon Serowiecki, AdvisIRy Partners ([email protected])
- Media Relations: [email protected]
Disclaimer: This article contains forward-looking statements that reflect management’s current expectations and projections about future events. Actual results may differ materially due to various risks and uncertainties. Investors should refer to Dragonfly Energy’s filings with the SEC and consult their financial advisor before making investment decisions. This article is for informational purposes only and does not constitute investment advice.
