Aurora Innovation, the Pittsburgh provider of self-driving technology, definitively agreed to go public by merging with a special purpose acquisition company, Reinvent Technology Partners Y. (RTP) - Get REINVENT TECHNOLOGY PARTNERS CLASS A Report
Reinvent is backed by investors including Reid Hoffman, the co-founder of LinkedIn (MSFT) - Get Microsoft Corporation (MSFT) Report, and Mark Pincus, the founder of Zynga (ZNGA) - Get Zynga Inc. Class A Report.
The deal values Aurora's equity at $11 billion. Investors and partners in Aurora have committed to invest $1 billion. At closing, Aurora expects to have $2.5 billion of cash.
At last check shares of Reinvent Technology Partners Y were trading up 0.4% at $10.04.
Aurora, employing 1,600, aims to "commercialize self-driving technology at scale for the U.S. trucking and passenger transportation markets," Pincus said in a statement.
The company says its system, called the Aurora Driver, is "designed to power multiple vehicle types, from passenger sedans to Class 8 trucks, to move safely and efficiently through the world without" human drivers.
Aurora hopes to launch first in trucking in late 2023 and then expand into verticals including last-mile delivery and ride-hailing.
Aurora Chief Executive Chris Urmson previously led the self-driving car team at Alphabet's Google (GOOGL) - Get Alphabet Inc. Class A Report. Its chief product officer, Sterling Anderson, launched Tesla's (TSLA) - Get Tesla Inc Report Model X SUV and its autopilot autonomous system.
The board of Aurora and the transaction committee of Reinvent Y have approved the terms. The companies hope to close the deal in the second half, subject to conditions including votes of holders of both companies.
Aurora expects to trade on Nasdaq under the ticker symbol AUR.
Investors in the deal include the Edinburgh, Scotland, investment manager Baillie Gifford; funds and accounts managed by Morgan Stanley and T Rowe Price; the mutual fund giant Fidelity Management & Research; Canada Pension Plan Investment Board, and the venture-capital firms Index Ventures and Sequoia Capital, among others.
SPACs, or blank-check companies, are formed for the express purpose of finding and merging with operating partners. The idea is to speed an operating company to the public markets and avoid the extended process of a traditional initial public offering.