Ouster announced that it has signed a definitive agreement to acquire 100% capital stock of Sense Photonics, which has developed a digital solid-state lidar sensor for automotive series production. It will also acquire its property for 9.5 million shares of Ouster common stock. Upon closing the strategic all-stock acquisition, Ouster plans to establish Ouster Automotive. This is a new functional division of the company focused on driving mass-market adoption of digital LiDAR in consumer and commercial vehicles.
Ouster Automotive will be led by Sense’s current CEO Shauna McIntyre. The division plans to accelerate Ouster’s solid-state roadmap by more than 12 months through Sense’s three-year, $24 million investment in CMOS digital lidar. It will also integrate Sense’s 200-meter range digital solid-state lidar into Ouster’s plan for a multi-sensor lidar suite that meets the performance and price requirements for Level 2+ autonomy.
The new division will equally seek to deliver on the flagship strategic development agreement awarded by a global automotive OEM to Sense earlier this year; and advance five series production programs worth over $1 billion in potential revenue. These are currently under negotiation with automotive OEMs ahead of a planned production date between 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.
Ouster 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 its solid-state product roadmap chip tape outs and design fees that same year. As a result, the cash impact is expected to be net neutral in 2022.
Ouster’s acquisition of Sense is expected to close in the fourth quarter of 2021, subject to customary closing conditions.