The companies have also signed commercial agreements for utilisation of the Lyft system and fleet data
Woven Planet Holdings, a subsidiary of Japan’s Toyota, has agreed to acquire Level 5, the self-driving unit of ride-hailing company Lyft, for $550m in cash.
The acquisition marks the first major deal for Woven Planet, which started business in January 2021.
The deal is expected to result in forming a team of approximately 1,200 people, by uniting scientists and software engineers from Level 5, Woven Planet, and researchers from Toyota Research Institute (TRI) already working together with Woven Planet.
The combined team will work together to speed up software innovation for automated driving mobility.
For Woven Planet, the acquisition is expected to bring in a set of sensing, computing, and software assets, and strategic capabilities in automated driving systems.
In addition, it is anticipated to expand Woven Planet’s presence beyond its Tokyo headquarters.
Upon completion of the transaction, the Toyota subsidiary will have offices and engineering teams in Palo Alto, California and London, UK.
Woven Planet investments & acquisitions head George Kellerman said: “With the acquisition of Level 5, Woven Planet is driving towards its mission to combine the innovative culture of Silicon Valley with world-renowned Japanese craftsmanship to create the mobility solutions of the future.
“This acquisition significantly accelerates our ability to bring technology solutions forward with an influx of exceptional engineers and leading-edge technology.
“It also provides a solid foundation for international expansion and future hiring efforts in the world’s strongest talent markets.”
Woven Planet and Lyft have also signed commercial agreements for utilisation of the Lyft system and fleet data.
The agreements are aimed at speeding up the safety and commercialisation of the automated-driving technology to be developed by Woven Planet.
Subject to the receipt of required regulatory approvals and other conditions, the transaction is expected to be closed in the third quarter of 2021.
Kellerman said: “We aim to become the centre of interconnected mobility systems, weaving together a variety of technologies and partnerships extending far beyond the automotive industry. This acquisition marks the first in a coordinated strategy to consolidate leading technologies and talent to help realize this vision.”
Following the sale of Level 5, Lyft’s Open Platform team will become the new Lyft Autonomous team.
Currently, the Open Platform team works on the deployment and scaling of third-party self-driving technology on the Lyft network.