October 5, 2021
Ouster has announced it signed a definitive agreement to acquire Sense Photonics, which develops digital solid-state lidar sensors for automotive applications. Upon closing of the all-stock acquisition, Ouster said it will establish Ouster Automotive, a new functional division of the company that focuses on driving mass-market adoption of digital lidar in consumer and commercial vehicles.
Following the close of the translation, Ouster Automotive will be led by current Sense CEO Shauna McIntire. The company also plans to:
- Accelerate Ouster’s solid-state roadmap by more than 12 months through Sense’s three years and $24 million investment in CMOS digital lidar;
- Integrate Sense’s 200-meter range digital solid-state lidar into Ousters’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 strategic development agreement awarded by a major global automotive OEM to Sense earlier this year;
- Advance five series production programs collectively worth more than $1 billion in potential revenue, currently under negotiation with automotive OEMs for production in 2025-2026.
Ouster said it also expects to strengthen its competitive position by retaining key Sense talent with deep engineering, semiconductor and automotive expertise, and by acquiring more than 100 pending patents and an exclusive license to more than 250 patents from Sense.
“Ouster and Sense are an ideal pairing,” said Ouster CEO Angus Pacala. “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. Ouster’s digital technology has enabled us to pull ahead in the industrial, robotics, and smart infrastructure markets, and emerge as a top player in automotive.”
Ouster will 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 said it expects the cash impact of approximately $17 million in additional operating expenses 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 in R&D savings. The company said 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. The transaction is expected to close in Q4 2021, subject to customary closing conditions.