Aeva makes SPAC deal to scale up production of 4D lidar on a chip for self-driving cars

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Special purpose acquisition company InterPrivate Acquisition Corp. yesterday announced that it has entered into a definitive agreement for a business combination with lidar maker Aeva. Mountain View, Calif.-based Aeva claims to be the first company to provide a perception platform built from the ground up on silicon photonics for mass-scale application in automotive, consumer electronics, and other sectors.

Soroush Salehian and Mina Rezk, former engineering leaders at Apple and Nikon, founded Aeva in 2017. The company said it is building the next generation of sensing and perception for autonomous vehicles and beyond. Aeva has a multidisciplinary team of more 100 experienced leaders, engineers, and operators, It said it is actively engaged with 30 of the top players in automated and autonomous driving across passenger, trucking, and mobility.

InterPrivate is a blank-check company organized for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization, or other similar business combination with one or more businesses or entities. The special purpose acquisition company (SPAC) is controlled by affiliates of Chairman and CEO Ahmed M. Fattouh and InterPrivate LLC, a firm founded by Fattouh that invests on behalf of a consortium of family offices in partnership with independent sponsors from the private equity and venture capital industries.

Aeva offers 4D lidar on a chip

Aeva said its 4D LiDAR on Chip combines instant velocity measurements and long-range performance at affordable costs for commercialization at silicon scale.

With its software stack, Aeva plans to scale its perception platform to a range of industries beyond automotive, including consumer electronics, consumer health, industrial robotics, and security.

Unlike legacy lidar, which relies on time-of-flight (ToF) technology and measures only depth and reflectivity, Aeva uses frequency modulated continuous wave (FMCW) technology to measure velocity in addition to depth, reflectivity, and inertial motion. The company added that this draws significantly less power than other available technologies, including ToF, to bring perception to broad applications at an industry-leading cost.

“From the beginning, we believed that the only way to achieve the holy grail of lidar is to be integrated on a chip,” stated Mina Rezk, co-founder and chief technology officer of Aeva. “Over the last four years, we did it by leveraging Aeva’s unique coherent FMCW approach. With today’s announcement, we can use our development efforts to expand into new markets that were simply not possible before.”

Partners for production

In September, Aeva announced a production partnership with ZF Friedrichshafen, one of the world’s largest Tier 1 automotive suppliers, to supply what it described as the first automotive-grade 4D lidar to global OEM customers. The partnership will combine Aeva’s expertise in frequency modulated continuous wave (FMCW) lidar with ZF’s experience in mass production of automotive-grade sensors.

“Our vision has been to create a fundamentally new sensing system to enable perception across all devices,” said Soroush Salehian, co-founder and CEO of Aeva. “This milestone accelerates our journey toward delivering the next paradigm in perception to mass-market applications, not just in automotive, but [also] consumer and beyond.”

In 2019, Aeva announced a partnership with Audi’s Autonomous Intelligent Driving entity. Aeva has also partnered with multiple other passenger car, trucking, and mobility platforms to further adoption of advanced driver-assistance systems (ADAS) and autonomous applications.

SPAC combination worth $2.1B

Aeva said it plans to use 100% of the net proceeds from the transaction to accelerate its growth and commercialization. The combined company will have an implied pro forma equity value of approximately $2.1 billion at closing, and Aeva’s existing stockholders will hold approximately 80% of the issued and outstanding shares of common stock immediately following the closing.

The combined Aeva-InterPrivate business will provide up to $363 million in gross proceeds, including InterPrivate’s $243 million held in trust and a $120 million fully committed common stock PIPE (private investment in public equity) at $10 per share, including investments from Adage Capital and Porsche SE, the major shareholder of VW Group.

“We look forward to our combination with Aeva, which was the clear stand-out amongst the 100+ merger targets we evaluated,” said Ahmed Fattouh, chairman and CEO of InterPrivate. “The company’s breakthrough technology combines the key advantages of lidar, radar, motion sensing, and vision in a single compact chip.”

“As a result of this transaction, including the upsized PIPE private placement, Aeva is not expected to require any additional funding to achieve significant cash flow through its commercial partnerships with world class customers,” he said. “Soroush, Mina and their team are revolutionizing sensing solutions, not only for the automotive industry, but ultimately across all devices.”

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Aeva transaction details

All Aeva stockholders, including Lux Capital, Canaan Partners, and Lockheed Martin, will retain their equity holdings through Aeva’s transition into the publicly listed company. It previously raised $45 million in Series A funding in October 2018. Upon closing of the transaction, the combined company will be renamed “Aeva Inc.” and is expected to continue to be listed on the New York Stock Exchange and trade under the ticker symbol “AEVA.”

“Cash proceeds in connection with the transaction will be funded through a combination of (i) the issuance of approximately $120 million of common stock through a fully committed private placement at $10.00 per share, including investments from Adage Capital and Porsche SE, (ii) the issuance of $ 1.7 billion of new common stock of InterPrivate to current stockholders of Aeva subject to customary adjustments and (iii) $243 million of cash held in trust assuming no redemptions by InterPrivate’s existing public stockholders,” said the companies.

Completion of the proposed business combination is subject to, among other things, the approval by InterPrivate and Aeva stockholders and the satisfaction or waiver of other customary closing conditions, including a registration statement being declared effective by the Securities and Exchange Commission and is expected to occur in the first quarter of 2021. Following completion of the transaction, Aeva will retain its management team.