Ouster is set to acquire Sense Photonics, which has developed a digital solid-state lidar sensor for automotive series production, to become a 'market leader in automotive.'
Ouster anticipates the sale will position it as frontrunner in automotive, thanks to the digital solid-state lidar sensor, a major global auto OEM deal, and series production traction with global automakers.
Upon closing the all-stock acquisition Ouster plans to establish Ouster Automotive, a new functional division of the company focused on driving mass-market adoption of digital lidar in consumer and commercial vehicles.
Sense CEO Shauna McIntyre said: 'We have a terrific opportunity to marry our two platforms to capture additional automotive design wins. Furthermore, Ouster’s resources, manufacturing know-how, and proven ability to execute gives us confidence that, together, we have what it takes to become the market leader in automotive.'
Ouster Automotive will be led by current Sense CEO Shauna McIntyre. Ouster Automotive plans to:
- Accelerate Ouster's solid-state roadmap by more than 12 months through Sense's approximately three years and $24 million investment in CMOS digital lidar;
- Integrate Sense's 200m range digital solid-state lidar into Ouster’s plan for the industry’s first multi-sensor lidar suite that meets the performance and price requirements for Level 2 and above autonomy;
- Deliver on the flagship strategic development agreement awarded by a major global automotive OEM to Sense earlier this year; and
- Advance five series production programs collectively worth over $1 billion in potential revenue, currently under negotiation with automotive OEMs for start of production in 2025-2026.
Ouster also expects to strengthen its competitive position by retaining key Sense talent with deep engineering, semiconductor, and automotive expertise, and by acquiring from Sense over 100 pending patents and an exclusive license to over 250 patents.
'Combining Ouster’s digital expertise and maturity in product development and manufacturing with Sense’s advanced solid-state digital lidar silicon is expected to accelerate the delivery of our multi-sensor digital lidar suite for the consumer ADAS market,' said Ouster CEO Angus Pacala.
Transaction highlights:
- Ouster to purchase 100% of the capital stock of Sense and all of its property for 9.5 million shares of Ouster common stock contingent upon customary closing adjustments and conditions.
- Ouster management expects the cash impact of approximately $17 million additional operating expense in 2022 — excluding non-cash stock-based compensation in research and development, sales and marketing and general and administrative expenses of approximately $8 million, $2 million, $2 million, respectively — to be completely offset by approximately $17 million R&D savings related to our solid-state product roadmap chip tape outs and design fees that same year. Therefore, the cash impact is expected to be net neutral in 2022.
- Approximately 80 Sense employees are expected to join Ouster post-transaction; certain employees of Sense have agreed to five-year retention packages.
- Transaction is expected to close in the fourth quarter of 2021, subject to customary closing conditions.
