Tenax Aerospace to Go Public via Reverse Merger with Air Industries Group

This article is based on an official press release from Air Industries Group and Tenax Aerospace.

Tenax Aerospace to Go Public via Strategic Reverse Merger with Air Industries Group

On February 17, 2026, Tenax Aerospace Acquisition, LLC and Air Industries Group (NYSE American: AIRI) announced a definitive merger agreement that will reshape the landscape for both entities. Structured as a reverse merger, the transaction will see the privately held Tenax Aerospace effectively acquire the publicly traded Air Industries Group. The combined entity aims to establish a diversified, mid-cap aerospace and defense platform, blending special mission aviation services with precision manufacturing capabilities.

According to the announcement, the combined company will retain the Air Industries Group name and continue trading on the NYSE American exchange under the ticker symbol AIRI. The deal is expected to close before June 30, 2026, pending shareholder and regulatory approvals.

Transaction Details and Financial Structure

The agreement outlines an all-stock transaction that heavily favors the acquiring private entity. Post-merger, Tenax shareholders are set to own approximately 95% of the combined company, while existing Air Industries shareholders will retain roughly 5%. This structure reflects the significant difference in scale and financial health between the two organizations.

Key financial terms disclosed in the release include:

• Share Issuance: Air Industries Group will issue approximately 112.5 million shares to Tenax members.
• Valuation: The issuance is based on a “Debt Adjusted AIR Share Price” of approximately $3.44 per share.
• Debt Profile: The combined entity is projected to carry a net debt of approximately $380 million at closing. This figure includes $80 million in debt recently incurred by Tenax to buy out its minority partner, Bain Capital, in January 2026.
• Breakup Fee: A mutual termination fee of $1.25 million has been established should the deal fail under specific conditions, such as a breach of contract.

Strategic Rationale: Scale and Vertical Integration

The merger is positioned as a strategic move to create a vertically integrated aerospace platform. For Tenax Aerospace, headquartered in Ridgeland, Mississippi, the deal provides immediate access to public capital markets. This access is intended to fund fleet expansion and growth without the hurdles of a traditional Initial Public Offering (IPO). Tenax specializes in special mission aviation services, including aerial firefighting and intelligence gathering for U.S. government clients.

For Air Industries Group, based in Bay Shore, New York, the merger offers a financial lifeline. The company, a Tier 1 supplier of precision components for platforms like the F-35 and Black Hawk, has faced recent financial headwinds, including a net loss of approximately $1.3 million in 2025. By joining forces with Tenax, AIRI moves from a micro-cap component supplier to a subsidiary of a larger, profitable defense services provider.

Pro Forma Financial Outlook

The companies released preliminary pro forma financial projections for the combined entity, highlighting a stronger profile than AIRI could achieve alone:

• Projected 2026 Revenue: Greater than $210 million.
• Projected 2026 Adjusted EBITDA: Greater than $75 million.

Data from the announcement indicates that Tenax contributes the vast majority of this earning power, with AIRI contributing approximately $48 million in revenue and minimal EBITDA to the combined totals.

Leadership and Governance

Following the close of the transaction, the leadership structure will shift to reflect Tenax’s majority ownership. Tom Foley, the current Chairman of Tenax and NTC Group, will assume the role of Chairman of the combined company.

The Board of Directors will also be reconstituted to favor the acquirer. Tenax will select six or more directors, while the current Air Industries board will jointly select only two directors with Tenax. While specific CEO appointments were not detailed in the initial release, the governance structure suggests Tenax management will drive the strategic direction of the public entity.

AirPro News Analysis

This transaction represents a classic “backdoor listing” for Tenax Aerospace, allowing it to bypass the volatility and expense of a traditional IPO while securing a liquid currency (public stock) for future acquisitions. For Air Industries Group shareholders, the deal presents a stark reality: while they face massive dilution, retaining only 5% of the company, the alternative was likely continued financial distress given their recent performance and debt load.

The market’s muted reaction on the day of the announcement, with AIRI stock remaining flat at $3.19, likely reflects this trade-off. Investors appear to be weighing the benefits of survival and participation in a larger entity against the heavy debt load ($380 million) and the near-total dilution of current equity. The success of this merger will hinge on the combined company’s ability to service that debt while integrating a service-heavy business model with a manufacturing-heavy one.

Sources

• Air Industries Group Investor Relations