Velodyne Lidar Inc., a maker of sensors for self-driving vehicles backed by Ford Motor Co., has agreed to merge with special-purpose acquisition company Graf Industrial Corp., according to a statement Thursday.
The market value of the combined company will be about $1.8 billion, according to the statement, which confirmed an earlier Bloomberg News report. New institutional investors and existing Graf Industrial shareholders have committed $150 million to fund the transaction.
Velodyne backers including Ford, Baidu Inc., Nikon Corp. and Hyundai Mobis will retain an 80 percent stake in the combined company. The San Jose, Calif.,-based company will have about $200 million in cash on its balance sheet, and David Hall, Velodyne’s founder, will become executive chairman. Velodyne CEO Anand Gopalan will continue to lead the company.
Velodyne creates radar-like systems for self-driving vehicles that use lasers to generate three-dimensional images of a surrounding environment. Its technology is used by automakers including Mercedes-Benz and Ford, according to its website.
Graf Industrial, a special-purpose acquisition company, raised $225 million in an initial public offering in 2018.
Merging with a SPAC has become a popular way for companies to go public as the coronavirus pandemic roils the markets, as an alternative to an initial public offering or direct listing.
Online used-vehicle seller Shift Technologies said this week it plans to go public later this year through a reverse merger with a SPAC.
Online gambling company DraftKings Inc., potato chip maker Utz Quality Foods and fitness company F45 Training Holdings Inc. also struck deals with SPACS in recent months.