Cargo drone company Elroy Air is approaching an $800 million agreement with a SPAC.

      The creator of the autonomous Chaparral is engaged in advanced negotiations to go public via a blank-cheque merger that would value the combined entity at approximately $1 billion. The SPAC, which has been declared defunct multiple times in recent years, continues to find new applications, the latest being a cargo drone.

      Elroy Air, a startup based in California aiming to replace certain delivery trucks with autonomous drones, is in advanced discussions to merge with a blank-cheque company for its public listing. This agreement would establish a company with an enterprise value nearing $1 billion and could be publicly announced as soon as today.

      The merging partner is Columbus Circle Capital Corp. II, a special-purpose acquisition corporation managed and supported by the team from Inflection Point Asset Management. The fundraising related to this transaction is approximately $800 million, although specifics regarding the structure had not been disclosed when the discussions were reported.

      Elroy Air’s product explains the interest in the company. Founded in 2017 by David Merrill and Clint Cope, it manufactures the Chaparral, a hybrid-electric drone designed for middle-mile logistics, featuring vertical take-off and landing capabilities. This aircraft is intended to autonomously carry 300 pounds of cargo over 300 miles, bridging the gap between distribution hubs and local depots that are too distant for a van to serve economically but too close for a traditional aircraft.

      It is a heavier-payload variant of the grocery and parcel drones currently in commercial operation in Europe. The company’s order book provides a basis for its valuation. Elroy Air reports around 1,500 preorders from clients like FedEx and Bristow Group, along with active contracts and interest from U.S. and allied military forces.

      In January 2026, the company entered into a $200 million joint venture with Abu Dhabi’s Barq Group to produce the Chaparral, with a goal for commercial deployment this year. The defense aspect has gained significance. Earlier this year, Elroy Air was chosen to deliver autonomous aerial cargo as part of a new White House initiative, and interest from U.S. and allied militaries complements the commercial orders.

      The use of autonomous logistics in contested or hard-to-access areas is a scenario that militaries are eager to develop, especially as Europe’s first licensed cargo drone moves closer to functioning, and a drone capable of carrying 300 pounds without a pilot aligns with both military and middle-mile delivery needs.

      Taking a pre-revenue or early-revenue hardware enterprise public through a merger with a blank-cheque vehicle allows for raising capital and securing a listing without the scrutiny of a traditional IPO roadshow. This has been the reason for the rise and subsequent decline of such deals among capital-seeking aerospace and mobility startups.

      The broader drone delivery sector has spent a decade promising deployments that have largely remained just out of reach. Elroy Air’s manufacturing goals are costly, and going public is one method to finance the development necessary for deployment.

      Preorders do not equate to revenue, and while targeting commercial deployment in 2026 is an aspiration, it remains unfulfilled. The merger, as mentioned, is still under negotiation and has not yet been finalized, with potential changes to the terms before any announcement.

      What is currently proposed is a valuation of about $1 billion for a company whose aircraft is progressing towards deployment but has not yet achieved it, facilitated by a vehicle whose backers are placing a bet. The next indication to watch for is whether the deal is announced as scheduled or if there are delays.