Berkshire Grey, a developer of integrated artificial intelligence and robotic solutions for e-commerce, retail replenishment, and logistics, is going public through a merger with special purpose acquisition company (SPAC) Revolution Acceleration Acquisition Corp (RAAC). The deal values the combined company at $2.7 billion.
Berkshire Grey said it will have approximately $507 million in cash when the deal closes in the second quarter of 2021. The money will be used to fund operations and support new and existing growth initiatives. There is no debt on the company’s balance sheet.
Founded in 2013 by CEO Tom Wagner, who is former CTO of iRobot, Berkshire Grey automates materials handling applications in warehouses and logistics fulfillment centers. It emerged out of stealth mode in 2018. Using proprietary technology, Berkshire Grey offers robotic picking systems and mobile robotics systems, as well as sensing, gripping and machine vision systems. It said its IP is protected by more than 300 patent filings.
“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.”
Berkshire Grey said only about 5% of warehouses are automated today, which highlights the market opportunity for providers of warehouse automation solutions. Berkshire Grey’s customers reportedly include Walmart Target and FedEx. Berkshire Grey reported $35 million in revenue in 2020.
“Today’s consumers expect a better selection of goods, at lower prices, with shipping that is immediate,” said RAAC CEO John Delaney, who will remain on the board of directors of the combined company upon completion of the transaction. “In our judgment, Berkshire Grey’s best-in-class technology and uniquely integrated solutions provide a critical pathway for companies to adapt to these changing needs. The Company’s strong relationships with an installed base of blue-chip clients is a testament to its ability to deliver tangible and measurable results that empower companies to compete even more effectively. Steve Case and I are honored to partner with Tom and the rest of Berkshire Grey’s talented team and investors to realize this singular opportunity to revolutionize how businesses operate.
SPAC craze goings to grow
There were 219 SPAC deals in 2020, and it appears the craze is just getting started in the robotics industry. SoftBank recently announced it is raising $525 million in a blind pool SPAC for investments in artificial intelligence.
Berkshire Grey is backed by Softbank. It participated in Berkshire Grey’s $263 million Series B that closed in January 2020. Other participants in the round included Khosla Ventures, New Enterprise Associates, and Canaan.
Six LiDAR companies have already gone public or will go public via SPACs. AEye became the latest to do so earlier in February. It develops LiDAR sensors for autonomous vehicles and advanced driver assist systems. It is going public through a merger with CF Finance Acquisition Corp. III that will value the company at $2 billion. Aeva, Luminar, Innoviz, Ouster, and Velodyne are the other LiDAR SPAC companies.
Kyle Vogt, co-founder, president & CTO at autonomous vehicle company Cruise, said the LiDAR industry will eventually consolidate, similar to what the robotaxi industry has gone through the last two years.