Aurora, a self-driving car startup, merged with Spac for $11 billion to go public
Aurora, a self-driving car startup backed by Amazon and Uber, announced a plan to merge and go public with a bad check company, becoming the first top company in the industry to go public and establish a new company. Test the appetite of investors for such costly companies.
Aurora said on Thursday that it will merge with a special purpose acquisition tool set up by LinkedIn co-founder Reid Hoffman and technology entrepreneur Mark Pincus.
The transaction valued Aurora at 11 billion U.S. dollars and provided it with nearly 2 billion U.S. dollars in new funding, which allegedly would enable it to “launch its first autonomous driving product by the end of 2023.”
This Bay Area company with 1,600 employees consists of three Pioneer of unmanned driving technology — Including CEO Chris Urmson, Sterling Anderson and Drew Bagnell, who led Tesla’s Autopilot work, from Uber’s self-driving team, Which was acquired by Aurora in December last year.
Aurora was founded in 2016 when robotic taxi startups were booming and competing with Google’s self-driving car project. Urmson served as the chief engineer in the project until he left in 2015.
The transaction allowed Aurora to obtain $850 million raised by Hoffman and Pincus’ Spac, Reinvent Technology Partners Y, and $1 billion in new investment from a consortium including Baillie Gifford, Fidelity and the Canadian Pension Plan Investment Board.
Aurora is valued at US$11 billion, which is higher than the US$10 billion when it acquired Uber’s business last year. Recently, rival self-driving car companies Cruise and Waymo are valued at more than US$30 billion, the latter evolved from Google’s self-driving project From the Alphabet department.
Different from GM support cruise with Wimo, Aurora has not built a large number of prototype cars to test on the road. Instead, it focuses on testing in a simulated world, and it claims to “drive” the equivalent of 22 million miles per day.
“We have invested a lot of money in simulation and virtual development tools,” Urmson told the Financial Times. He added that paying special attention to virtual driving is “a huge cost advantage.”
Aurora also reduced its early emphasis on robotic taxis in favor of Driverless semi truck. Earlier this year, it signed a partnership with Volvo Trucks and Paccar (the manufacturer of Peterbilt and Kenworth heavy trucks). The combined market share of these groups in the United States exceeds 50%.
It has also established partnerships with Uber, Toyota, and Japanese parts supplier Denso. Uber, Paka, and Volvo are contributing to this $1 billion new financing.
Aurora disclosed on Thursday that it expects cash outflows of US$553 million this year and expects another US$3.7 billion in cash outflows in the next five years. After the Spac transaction is completed, the company will have US$2.5 billion in cash.
After the news of the merger came out, the share price of Reinvent Technology Partners Y rose by 2%.
Hoffman and Pincus are now Spac’s continuous trade executors.Their other blank check company bought a flying taxi startup Jobby Aviation Earlier this year.
Pincus said that investors in the Aurora transaction agreed to lock in for four years, which is longer than usual, while a typical Spac investor only agrees to six months or one year.
“Aurora is rapidly iterating to solve a very difficult problem, focusing on large-scale actual commercialization rather than promoting live demonstrations,” Pincus said. “From reducing hardware costs to working closely with OEMs, everything they do is focused on launching true commercial-scale solutions.”