Austin Russell demonstrates image created by a lidar in Portola Valley, California, US
Photographer: David Paul Morris / Bloomberg
Photographer: David Paul Morris / Bloomberg
Startless for motorists Luminar Technologies Inc., backed by tech billionaire Peter Thiel, goes public over a $ 3.4 billion merger with blank-check company Gores Metropoulos Inc., is supporting efforts to get its laser sensors on the production line of global motorists.
The deal will be paid with $ 400 million in cash from the blank-check company, as well as $ 170 million from other investors including Thiel, a unit of Volvo Car AB en GoPro Inc. founder Nick Woodman, according to a statement on Monday that confirmed an earlier Bloomberg News report.
Luminar is the latest entity to merge with a specialty purchasing company, or SPAC. The investment funds have gone mainstream this year, offering a faster route for startups trying to go public without the control or risks of an initial public offering.
Led by 25-year-old Chief Executive Officer Austin Russell, Luminar has emerged from a crowded startup field by lowering the cost of lidar sensors, which dissipate lasers from objects to guide cars. The cost of the sensors can run into the tens of thousands of dollars and has been a stumbling block for companies looking to compete in the self-driving car race.
In May, Volvo said it would use Luminar’s technology to enable hands-free highway driving in cars starting in 2022.
Russell said he chose to go public earlier than expected because, amid uncertainty caused by the coronavirus, the boom in low-check business dealmaking offers a more secure way to access funds than an IPO.
“By the time this is over, we will have brought in $ 500 million from the north – that will enable us to make these kinds of strategic investments and further accelerate our programs and timelines and customer adoption,” Russell said by phone.
Luminar is of purpose to sell first its sensors for advanced safety features in passenger cars and driverless trucks, instead of fully autonomous fleet of robotic taxis, Russell said.
Gores Metropoulos is backed by Alec Gores’ Los Angeles-based private equity firm Gores Group LLC and Dean Metropoulos, a veteran consumer space investor.
Gores, who is the CEO of Gores Metropoulos, said Austin developed the only lidar technology that meets the strictest safety specifications of mantle caregivers, and he did so from time to time. “Luminar is well positioned to dominate the autonomous landscape,” he added.
Luminar and its existing investors will eventually hold about 80% of the company as part of the deal, and Gores Metropoulos will own about 11%, Russell said.
Gores Metropoulos raised $ 400 million, including so-called greenshoe shares, in an initial public offering in February 2019. The shares closed Friday at $ 10.51, giving it a market value of $ 525.5 million.
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Auto-tech companies have benefited from the rise in low-check deals, as investors who previously favored traditional IPOs are now looking for companies with higher growth.
In June, another company that makes sensors used in self-driving cars, Velodyne Lidar Inc., announced a deal to merge with company with low control Graf Industrial Corp.
After the deal closes, Luminar will be traded on the Nasdaq Select Market under the ticker LAZR.
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