Aurora Completes $820 Million Capital Raise for Autonomous Truck Business
Introduction
Aurora Innovation, a self-driving technology company, has successfully completed an $820 million capital raise through a simultaneous public and private offering of its shares. The company aims to launch its autonomous truck business by 2024 and expects the funding to support its commercial launch and operations through 2025.
Background
In November 2022, Aurora announced that it had enough funds to reach mid-2024. However, the company stated that it would need additional capital to ramp up operations and achieve its commercial launch goals. In a memo leaked in September 2022, Aurora CEO Chris Urmson outlined various options to raise $300 million within the next year to extend their runway.
In April, Aurora submitted a proposed mixed platform offering to raise $350 million, indicating its intention to secure funding for its expansion plans.
Capital Raise Details
The capital raise consists of two parts:
- A public offering of 73,333,333 Class A common shares at a price of $3 per share, totaling $220 million.
- A private offering of 222,222,216 shares at a price of $2.70 per share, amounting to $600 million.
The company’s stock price closed at $2.92 on Thursday.
Usage of Funds
Aurora has not provided specific details on how it plans to allocate the raised funds. According to the company’s prospectus, the capital will be utilized for working capital, general corporate purposes, and potential acquisitions or investments in other businesses, technologies, products, or assets.
Commercialization Plans
Aurora has prioritized the commercialization of autonomous trucks and has formed pilot alliances with FedEx, Paccar, Schneider, Werner, and Xpress. The company plans to launch its commercial autonomous truck business next year, operating a fleet of approximately 20 trucks between Dallas and Houston. These trucks will transport cargo for driverless customers.
Investor Details
The names of the investors involved in the capital raise will be disclosed upon the closing of the deal on Friday. Aurora has confirmed the participation of several existing institutional and strategic investors.
Prospects and Future Outlook
Aurora’s successful capital raise is expected to provide the necessary funds to propel the company through its planned commercial launch and sustain operations until at least 2025. The self-driving technology sector continues to attract significant investment, underscoring the growing interest and potential in autonomous transportation.
Summary
Aurora Innovation has raised $820 million in capital through a combination of public and private offerings to support its autonomous truck business, which is scheduled to launch by 2024. The company’s CEO, Chris Urmson, had previously outlined the need for additional funding to extend the company’s runway and ensure a successful commercial launch. The capital raise consists of a public offering and a private offering, with the funds expected to be utilized for various purposes, including working capital, general corporate needs, and potential acquisitions or investments in other businesses or assets. Aurora has established partnerships with key industry players and plans to operate a fleet of autonomous trucks between Dallas and Houston. The successful capital raise highlights the significant interest and investment in self-driving technology and the potential opportunities it presents for the transportation industry.
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Dawn Innovation, the self-driving technology company that aims to launch an autonomous truck business by 2024, has completed an $820 million capital raise from a simultaneous public and private offering of its shares. The company expects the deal to close on Friday.
The share sale will help fund Aurora through commercial launch late next year and “well into 2025,” according to the company. Aurora said in November 2022 that there was enough money to get to mid-2024. The pre-revenue company has repeatedly said it would need to ramp up again to get to launch and beyond.
In September 2022, a leaked note It showed that Aurora CEO Chris Urmson had been weighing a variety of options to preserve the company’s cash position, including spin-offs, layoffs, acquisitions, and, of course, raises. In the memo, Urmson said it was worth finding “a path to raise $300 million in the next year to add about six months to our track.”
In April, Aurora submitted a proposed mixed platform offering for raise $350 million.
“We’ve always been transparent and said we would need to raise more money before our commercial launch and profitability,” Rachel Chibidakis, a spokesperson for Aurora, told TechCrunch. “This sizeable capital increase is expected to help us move past the launch of our autonomous truck business, which is planned for next year and well into 2025.”
Aurora, which has prioritized the commercialization of autonomous trucks, has pilot alliances with fedex, Paccar, Schneider, Werner and Xpress. The commercial launch will involve operating a fleet of about 20 trucks between Dallas and Houston, hauling cargo for driverless customers, a spokesperson told TechCrunch.
Aurora did not say specifically what it hopes to do with the funds. The company’s prospectus is vague, stating that Aurora will use the money for “working capital and other general corporate purposes.” Part of the money will be invested in investment grade instruments in the short and medium term. It is also possible that a portion of the proceeds will be used to acquire or invest in additional businesses, technologies, products or assets, the company wrote in a document.
The increase is divided into two parts. Aurora is selling 73,333,333 Class A common shares at the public offering price of $3 per share, or a value of $220 million. The company is also selling 222,222,216 shares privately at a price per share of $2.70, or a value of $600 million, for a user information which was presented on Tuesday.
The shares were trading at $3.22 on Tuesday at close before falling sharply in after-close trading to $2.87. Aurora’s stock price closed Thursday at $2.92.
Aurora has not yet stated when it will report second-quarter earnings, at which time they are expected to outline their plans for cash. The company said in a filing that it expects to report $785 million in cash, cash equivalents and short-term investments beginning June 30, 2023. That number does not include the $820 million from the share sale.
The names of the investors will come to light once the deal closes on Friday. Aurora only said that several existing institutional and strategic investors participated in the increase.
Autonomous vehicle company Aurora sells $820M worth of stock
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