Ouster and Velodyne complete merger of equals to accelerate lidar adoption

Ouster (NYSE: OUST), a provider of high-resolution digital lidar, and Velodyne, a global player in lidar sensors and solutions, announced the successful completion of their merger of equals, effective February 10, 2023. The combined company will keep the name Ouster and continue to trade on New York Stock Exchange under the ticker “OUST.”

The merger creates a lidar powerhouse with over 850 customers spanning the automotive, industrial, robotics, and smart infrastructure industries supported by a robust product portfolio of innovative hardware and software solutions in addition to top-tier engineering and commercial teams. Following integration, the combined Ouster expects to retain approximately 350 employees with its headquarters in San Francisco and key offices across the Americas, Europe, and Asia-Pacific. The merger is expected to drive significant cost synergies and value creation for the combined company and its stakeholders.

Key Strengths of the Combined Company:

“We’re thrilled to have completed the merger with Velodyne so quickly, further boosting our financial position and our ability to accelerate lidar adoption,” said Angus Pacala, CEO of Ouster. “Together, we have an even stronger team backed by a healthy balance sheet, new channel partners, and a wide selection of positive-margin products to serve a diverse set of customers and win more deals than ever before. We expect our innovative digital lidar roadmap, amplified by exciting new software solutions, to further expand our serviceable market and catalyze growth across the business.”

Ouster will provide a comprehensive update on its integration plans, including its product offering, technology roadmap, manufacturing and operations footprint, commercial strategy, and additional synergies across the business, on its fourth quarter 2022 earnings call.

Leadership and Governance

Ouster’s executive leadership team is comprised of:

Ouster’s eight-member Board of Directors is comprised of:

“The combined Ouster is stronger than ever, led by an esteemed executive leadership team and Board with deep company, industry, and financial expertise,” said Dr. Ted Tewksbury, Executive Chair of Ouster’s Board of Directors. “Ouster is well positioned as a global leader in lidar backed by the talent, products, and technology roadmap to make performant and affordable lidar solutions pervasive, while accelerating time to profitability and enhancing value for stockholders.”

Transaction Details

Velodyne shares ceased trading on the after market close on February 10, 2023, and each Velodyne share was exchanged for 0.8204 shares of Ouster common stock.

Barclays served as financial advisor and Latham & Watkins LLP served as legal advisor to Ouster. BofA Securities, served as financial advisor and Skadden, Arps, Slate, Meagher & Flom LLP served as legal advisor to Velodyne.

Fourth Quarter and Fiscal Year 2022 Earnings

Ouster expects to report its financial results for the fiscal year and fourth quarter ended December 31, 2022 after the market closes on Thursday, March 23, 2023 and will host a conference call that day at 5:00 p.m. ET to discuss its results.

As previously announced, Ouster achieved its fiscal year 2022 guidance of $40 to $55 million in revenue and 25% to 30% in gross margins. Additionally, Velodyne exceeded its fourth quarter 2022 guidance of $13 million and $15 million in billings2 and $12 to $14 million in revenue.

Financial Disclosure Advisory

Ouster reports its financial results in accordance with U.S. generally accepted accounting principles. All financial data in this press release is preliminary and represents the most current information available to Ouster’s management, as financial closing procedures for the year and fourth quarter ended December 31, 2022 are not yet complete. Actual results may differ materially from these estimates as a result of the completion of normal year-end accounting procedures and adjustments, including the execution of Ouster’s internal control over financial reporting, the completion of the audit of Ouster’s and Velodyne’s financial statements for the year ended December 31, 2022 and the subsequent occurrence or identification of events prior to the formal issuance of the fourth quarter and annual financial results.