Urban Aeronautics is working to establish a partnership with an undisclosed company in the United Arab Emirates (UAE) that could lead to manufacturing and financial support for the Israeli start-up’s CityHawk VTOL aircraft. The deal was outlined in a letter to prospective investors from the Besadno Group that offered the opportunity to participate in a $3.95 million funding round as part of a wider $50 million Series A round for Urban Aeronautics, in which the Israeli-American investment group is already a leading shareholder.
The February 7 letter came from Isaac Koren, chief operating officer of the U.S. office for InvestiNation, which Besadno describes as its equity crowd-funding platform for Israeli start-ups. It said that Urban Aeronautics is in late-stage negotiations with a UAE firm that makes parts for Airbus and Boeing “to open a fully funded manufacturing complex in the UAE which will manufacture and finance the production of future Urban Aeronautics VTOL aircraft.”
The envisaged partnership would mark a historic breakthrough in business relations between Israel and the UAE. It would build on the so-called Abraham Accord, brokered by the Trump Administration, which in September 2020 saw the two countries establish diplomatic relations after decades of animosity.
Given Besadno's description, the most likely UAE company involved in the reported talks would seem to be Strata Manufacturing, which is an established component and parts supplier to aerospace manufacturers Airbus, Boeing, Pilatus, Leonardo, and Saab. The Al Ain-based company is part of the UAE sovereign wealth fund Mubadala and manufactures aerostructures such as empennage and vertical fin ribs for the Boeing 777 and 787 airliners.
Initially, neither Urban Aeronautics nor Mubadala responded to a request from FutureFlight for confirmation that Strata is involved in the reported talks. However, in early March, a spokesperson for Urban Aeronautics said that talks do not involve the Mubadala subsidiary while confirming that the company is exploring a possible partnership in the UAE, indicating that Besadno's description of the prospective partner had not been accurate.
In December 2020, Besadno Group founder and chairman Eli Gross attended the Dubai MENA Business Expo. The company’s LinkedIn page shows him meeting publicly with members of the UAE royal family.
The InvestiNation letter says that capital raised through the planned Series A funding round will help Urban Aeronautics to “scale up and begin preparations for development of full-scale prototypes.” It added that certification of the VTOL aircraft, “will dramatically increase the company’s value and allow it to become publicly traded.”
Listing recent achievements for Urban Aeronautics, the letter also reported that the VTOL developer has signed a memorandum of understanding with Boeing “to present four requests for information to the U.S. military.” It added that the company also has signed a memorandum of understanding with IAI [presumably Israel Aerospace Industries] to develop a “custom model” for the Israeli armed forces.
Urban Aeronautics did not respond to requests for further information on these developments, but it seems highly likely that these refer to the company’s existing Cormorant unmanned aircraft, which is being developed for military applications. The CityHawk design, which is intended for roles such as passenger transportation and emergency medical services (EMS), uses the same Fancraft ducted fan propulsion technology as the Cormorant.
Last year, in a deal brokered by Besadno, U.S. EMS group Hatzolah launched a partnership to jointly promote the CityHawk in this sector. In January 2021, its Hatzolah Air subsidiary agreed to buy four of the new model, which is expected to enter service within three to five years.
The initial version of the aircraft, which will be powered by a pair of Safran’s Arriel 2N turboshaft engines, is expected to have a range of 175 miles and be ready to start flight testing in early 2023. Existing partners in the program include RADA Electronics Industries (navigation systems and sensors), CertCenterCanada (flight test and development work), Safran (powerplant), HyPoint (hydrogen fuel cells), and Kearfott Corp. (navigation and guidance systems). The program is being led by Urban Aeronautics’ Metro Skyways subsidiary.
New York-based Hatzolah Air views the CityHawk as an alternative to helicopters and fixed-wing aircraft. The company intends to use the VTOL model for first-response missions in urban areas. The main passenger-carrying design for the CityHawk will be adapted to accommodate a pilot, a patient plus a companion, two emergency medical personnel, and life-support equipment.
[This article was updated on March 8 to include corrected information provided by Urban Aeronautics regarding the status of partnership talks.]