Driverless technology startup Aurora Innovation Inc. has agreed to go public via a merger with Reinvent Technology Partners Y, a blank-check firm led by executives including LinkedIn co-founder Reid Hoffman and Zynga Inc. founder Mark Pincus.
The deal represents an equity value of $11 billion for Aurora, and the combined company will be valued at $13 billion, according to a statement. The company is expected to have about $2.5 billion of cash at closing that will allow it to commercialize self-driving trucks.
The transaction includes a $1 billion private investment in public equity from investors including Baillie Gifford and T. Rowe Price Associates Inc., as well as strategic investments from Uber Technologies Inc., Paccar Inc. and Volvo Group.
Bloomberg News reported Wednesday that Aurora and Reinvent had reached a deal.
Aurora is led by Chief Executive Officer Chris Urmson, and Hoffman is a board member.
The company expects to launch its first autonomous product, for trucks, in late 2023. The trucking industry is facing a shortage of qualified drivers, and Aurora’s technology is designed to work across Class 8 rigs, which are some of the biggest, as well as passenger cars and ride-hailing vehicles. Aurora is focusing its first efforts in Texas, which moves more freight by truck than any other state.
“We’re entering the trucking market first and we think we can build a heck of a business there, but we’re not cheating personal mobility,” Urmson said on a call with investors Thursday.
In March, the Silicon Valley-based startup added Volvo Group to its list of partners to develop self-driving trucks. Paccar joined with Aurora in January for a similar development deal. Aurora has said its other investors include Amazon.com Inc., Hyundai Motor Co. and Kia Motors Corp. Aurora previously raised funds from Index Ventures, Sequoia Capital and Greylock Partners, where Hoffman is a partner.
Aurora’s technology relies on innovations in lidar, which uses lasers to build a three-dimensional image of the surrounding landscape and help plot routes around obstacles. It uses a technology that is designed to allow vehicles to “see” farther and faster and is critical at highway speeds.
The transaction is expected to close by the end of this year, after which the combined company will trade on the Nasdaq under the ticker symbol AUR.
“We think Aurora will be a truly unique opportunity for public market investors to bet on the future of self driving, from trucking to passenger to delivery,” Reinvent’s Pincus said on the investor call.
Reinvent raised $978 million in a March initial public offering. Earlier Reinvent SPACs have separately agreed to merge with flying taxi startup Joby Aviation and insurance technology platform Hippo.