Listed on the NYSE, Ouster provides high-resolution digital lidar, while the NASDAQ-listed Velodyne offers lidar sensors and solutions, and their combination is expected to drive annualised operational expenditure savings of at least $75m within nine months of the closing of the merger deal
Ouster and Velodyne sign definitive agreement to merge. (Credit: Velodyne Lidar, Inc.)
US-based lidar technology companies Ouster and Velodyne Lidar have agreed to merge in an all-stock transaction, giving them a combined cash balance of nearly $355m as of 30 September 2022.
Listed on the New York Stock Exchange (NYSE), Ouster provides high-resolution digital lidar. On the other hand, the NASDAQ-listed Velodyne provides lidar sensors and solutions.
As per the terms of the agreement, Velodyne’s shareholders will receive 0.8204 shares of Ouster for each Velodyne share they hold.
Following the closing of the deal, Ouster and Velodyne will maintain a stake of nearly 50% in the newly combined company.
Ouster CEO Angus Pacala said: “Ouster’s cutting-edge digital lidar technology, evidenced by strong unit economics and the performance gains of our new products, complemented by Velodyne’s decades of innovation, high-performance hardware and software solutions, and established global customer footprint, positions the combined company to accelerate the adoption of lidar technology across fast-growing markets with a diverse set of customer needs.
“Together, we will aim to deliver the performance customers demand while achieving price points low enough to promote mass adoption.”
Pacala will be the CEO of the combined firm.
Velodyne and Ouster estimate to realise annualised operational expenditure savings of at least $75m within nine months of the completion of their merger deal.
The combined company is expected to have strong product offerings, which include verticalised software to cater to a larger set of customers.
Its intellectual property portfolio will have 173 granted and 504 pending patents, supported by more than two decades of combined experience in innovation in lidar technology.
Velodyne CEO Ted Tewksbury said: “We aim to create a vibrant and healthy lidar industry by offering both affordable, high-performance sensors to drive mass adoption across a wide variety of customer applications, and by creating scale to drive profitable and sustainable revenue growth.
“The combination of Ouster and Velodyne is expected to unlock enormous synergies, creating a company with the scale and resources to deliver stronger solutions for customers and society, while accelerating time to profitability and enhancing value for shareholders.”
The merger, which is subject to customary conditions and shareholders’ approval by both firms, is anticipated to close in the first half of 2023.