Berkshire Grey Merges with Robotics SPAC to Expand Warehouse Robotics
February 24, 2021
Berkshire Grey, which develops integrated artificial intelligence and robotics solutions designed for e-commerce, retail replenishment and logistics companies, has entered into a definitive agreement with Revolution Acceleration Acquisition Corp (RAAC), a special purpose acquisition company (SPAC) to create a publicly listed robotics and automation solutions company. The company estimates a post-transaction equity value of up to $2.7 billion.
Founded in 2013 by current CEO Tom Wagner, Berkshire Grey is a pure-play robotics company that offers fully integrated, AI-based software and hardware solutions to automate business operations in warehouses and logistics fulfillment centers. The company’s systems help retailers and logistics companies met the demand of consumers driven by the growth of e-commerce.
Since emerging from stealth mode in 2018, the company brings together AI with differentiated hardware to create robotic picking systems and multiple types of robotic mobility systems, which are orchestrated to improve efficiencies. This can include full robots, sensing systems, gripping systems and machine vision approaches. Berkshire Grey said its solutions are protected by more than 300 patent filings, and claim that operational efficiencies are achieved by customers with a return on investment between two and three years.
Berkshire Grey said it will continue to fill orders and negotiate with current customers, providing visibility into projected revenues for 2021 and 2022. The company said it also intends to grow its commercial organization to meet the increasing demand for its services, deepen relationships in key industry sectors, and build out new, value-added services.
John Delaney, the CEO of RAAC, will remain on the board of directors of the combined company upon completion of the transaction.
“Berkshire Grey was founded to help our customers compete even more favorably in the rapidly evolving worlds of retail and logistics,” said Wagner. “Consumer expectations have changed, putting more pressure on supply chain operations to get the right goods to the right places at the right times, as efficiently as possible. Over the last 12 months the pandemic amplified the already high pressure to transform, so today it is no longer a question of if companies might transform but how quickly. We are incredibly excited about this transaction, which will enable Berkshire Grey to accelerate growth and provide new and existing customers with our leading robotics solutions.”
The companies said the transaction is expected to provide up to $413 million in cash, including a fully committed PIPE of $165 million, with current Berkshire Grey shareholders (Khosla Ventures, New Enterprise Associates, Canaan Partners and SoftBank Group Corp.) rolling 100% of their equity into the combined company. The Private Investment in Public Equity (PIPE) is anchored by Chamath Palihapitiya, founder and CEO of Social Capital, Hedosophia and funds and accounts managed by BlackRock. At the closing, the company expects to have approximately $507 million in cash, which will be used to fund operations and support new growth initiatives, and no debt on its balance sheets. The transaction is expected to close during Q2 of 2021, subject to approval by RAAC’s stockholders and customary closing conditions.