Ouster and Velodyne achieved Fiscal Year and Q4
2022 guidance, respectively
Diverse Combined Company Board designees with
deep company, industry, and financial expertise
Approximately $315 million in combined cash1 as
of December 31, 2022
Ouster, Inc. (NYSE: OUST) (“Ouster”), a leading provider of
high-resolution digital lidar, and Velodyne Lidar, Inc. (Nasdaq:
VLDR; VLDRW) (“Velodyne”), a global player in lidar sensors and
solutions, announced today the proposed designations for the Board
of Directors of the Combined Company, subject to approval by the
Ouster Board of Directors and closing the proposed merger of
equals. The merger is expected to drive significant value creation
and result in a stronger financial position through robust product
offerings, increased operational efficiencies, and a
complementary customer base in fast-growing end-markets.
Combined Company Board of
Directors
After careful deliberation in the months following the
announcement of the proposed merger, Ouster and Velodyne each
selected their four designees to serve as directors of the Combined
Company after the proposed merger closes.
Ouster’s four designees to the Board of the Combined Company
include:
- Angus Pacala: Ouster Chief Executive Officer
- Susan Heystee: Ouster Board Chair; Ouster Compensation
Committee Chair and Audit Committee member
- Karin Rådstr�m: Ouster Nominating and Corporate Governance
Committee member
- Riaz Valani: prior Ouster Board member and long-term
investor
Velodyne’s four designees to the Board of the Combined Company
include:
- Dr. Ted Tewksbury: Velodyne Chief Executive Officer
- Virginia Boulet: Velodyne Board Chair; Velodyne Nominating and
Governance Committee Chair and Compensation Committee member
- Ernest Maddock: Velodyne Audit Committee Chair and Compensation
Committee member
- Kristin Slanina: Velodyne Audit Committee and Nominating and
Governance Committee member
“The announced designees put forward for the Board of the
Combined Company offer significant experience from their time as
business leaders across the automotive, semiconductor,
telecommunications, software, consumer products, and financial
industries,” said Ouster CEO Angus Pacala. “These seasoned
professionals are well-positioned to govern and guide the combined
company as we drive to accelerate the adoption of lidar on our path
to profitability, and are equally focused on enhancing value for
stockholders.”
Rationale for the Merger of
Equals
The Combined Company will offer a robust suite of products to
continue to serve a diverse set of end-markets and customers while
executing on an innovative product roadmap to meet the future needs
of the market. With an expanded global commercial footprint and
distribution network, the Combined Company expects to deliver
increased volumes, reduce product costs, and drive sustainable
growth. Key reasons for the merger of equals include:
- Accelerated lidar adoption through leveraging complementary
customer bases, industry partners and distribution channels as well
as reduced production costs;
- Ability to leverage the combined strengths of both companies,
which is expected to result in a more robust product suite and
expanded commercial reach;
- A unified team for top-tier customer support and customer
success; and
- Strengthened financial position, including operational
synergies to drive a more efficient cost structure and annualized
cost savings, thus extending the cash runway – collectively, these
attributes are expected to provide an improved path to
profitability.
Following stockholder approval, Ouster and Velodyne intend to
close the transaction promptly, and the combined company will be
positioned to leverage its strengthened balance sheet. With the
closing cash on hand, and subject to combined company Board
approval, the combined company will be positioned to pay off
Ouster’s credit facility debt of approximately $40 million2. Ouster
and Velodyne had a combined cash balance of over $315 million as of
December 31, 2022. The combined company expects to achieve
annualized cost savings of at least $75 million in operating
expenditure synergies, based on standalone cost structures as of
September 30, 2022, within 9 months of closing.
Fourth Quarter and Fiscal Year 2022
Financial Results
Ouster achieved its Fiscal Year 2022 guidance of $40 to $55
million in revenue and 25% to 30% in gross margins. Velodyne
exceeded its fourth quarter 2022 guidance of $13 million and $15
million in billings3 and $12 to $14 million in revenue.
Special Meeting of
Stockholders
On January 26, 2023, Ouster held its Special Meeting of
Stockholders at which its stockholders approved matters relating to
the proposed merger with Velodyne.
Velodyne will hold its adjourned Special Meeting of Stockholders
to approve the proposed merger with Ouster and other related
matters at 9:00 a.m. PT on February 3, 2023 at its office 5521
Hellyer Avenue, San Jose, CA 95138. All Velodyne stockholders of
record as of the close of business on December 5, 2022 are entitled
to vote and attend the Velodyne Special Meeting. For more
information on how to vote, visit Velodyne’s investor relations
website at https://investors.velodynelidar.com/.
About Board Member
Designees:
Angus Pacala has served as Ouster’s Chief Executive
Officer and director since he co-founded Ouster in June 2015.
Previously, Mr. Pacala was Director of Engineering at Quanergy,
Inc. from November 2012 to February 2015. Prior to that, Mr. Pacala
was Battery Engineer at Amprius, Inc. from June 2011 to October
2012. Mr. Pacala holds a Bachelor of Science degree in mechanical
engineering and a Master of Science degree in mechanical
engineering from Stanford University.
Susan Heystee has served as a member of the Ouster board
of directors since September 2018 and as Ouster’s Interim Chief
Revenue Officer since January 2021. Previously, Ms. Heystee was
Senior Vice President of Global Automotive Business at Verizon
Connect from January 2017 to June 2018. Previously, Ms. Heystee
served as Executive Vice President of Global Sales and OEM Business
at Telogis, which was acquired by Verizon in July 2016, from
February 2010 to December 2016. Ms. Heystee has also served as a
member of the board of directors of revVana Inc., a private
software-as-a-service company providing revenue realization
management solutions, since April 2020, as well as the ChargePoint,
an electric vehicle infrastructure company, since May 2021. Ms.
Heystee holds Bachelor’s degrees in mathematics and business from
the University of Waterloo and an executive degree from the
Advanced Management Program at Harvard Business School.
Karin Rådstr�m has served as the Chief Executive Officer
Mercedes-Benz Trucks and as a member of the Board of Management at
Daimler Truck AG since February 2021, and as a member of the
Supervisory Board of Piab AB, Sweden since June 2019. Ms. Rådstr�m
served as Head of Sales and Marketing and as a member of the
Executive Board of Scania CV AB (“Scania”) from March 2019 to
January 2020. She previously served as Senior Vice President, Head
of Buses and Coaches of Scania from November 2016 to February 2019
and as Director of Pre-Sales and Marketing Communication of Scania
East Africa Ltd. in Nairobi from October 2014 to December 2015. She
holds a Master of Engineering in Industrial Management from the
Royal Institute of Technology in Stockholm.
Riaz Valani is a general partner and founder at Global
Asset Capital. He previously served as chairman of Viventures
Partners SA, president of IMDI/Sonique, and a member of Gruntal
& Co.’s asset securitization group. Global Asset Capital, LLC
is a private equity investor with diversified interests in venture
capital, structured finance, and real estate. GAC has a strong
track record of success in building enterprises across the
telecommunications, media, and technology industries. Riaz also
serves on the board of Pratham USA, a charity that supports the
work of Pratham, an innovative learning organization created to
improve the quality of education in India.
Dr. Theodore L. Tewksbury has served as Velodyne’s Chief
Executive Officer since November 2021. Prior to that, he was CEO of
Eta Compute, a provider of ultra-low power AI vision systems, since
August 2019. Dr. Tewksbury has served as a member of the board of
directors of Maxlinear, Inc. since May 2015. From February 2017 to
March 2019, Dr. Tewksbury was Chairman, President and CEO of Energy
Focus, Inc., a provider of high-performance LED lighting
technology. Dr. Tewksbury served as interim president and chief
executive officer of Entropic from November 2014 until MaxLinear’s
acquisition of Entropic in April 2015. Dr. Tewksbury also served as
a director of Entropic from September 2010 through April 2015. From
2013 to November 2014, Dr. Tewksbury was an independent consultant
to technology companies. From 2008 to 2013, Dr. Tewksbury served as
the president and chief executive officer and as a member of the
board of directors of Integrated Device Technology, Inc., a
publicly traded, mixed signal semiconductor solutions company.
Prior to joining Integrated Device Technology, he was the president
and chief operating officer of AMI Semiconductor, a mixed signal
semiconductor company from 2006 to 2008. Prior to that, Dr.
Tewksbury served as managing director at Maxim Integrated Products,
Inc., a designer, manufacturer and seller of high-performance
semiconductor products, from 2000 to 2006. Dr. Tewksbury was a
member of the board of directors of the Global Semiconductor
Alliance from 2011 to 2013. Dr. Tewksbury holds a B.S. in
Architecture and an M.S. and a Ph.D. in Electrical Engineering and
Computer Science from the Massachusetts Institute of
Technology.
Virginia Boulet has served as a member of Velodyne’s
board of directors since November 2021 and was appointed
Chairperson in July 2022. She served as a Managing Director of
Legacy Capital, LLC from April 2014 until 2019. From 2014 through
2018, she was an adjunct professor of law at Loyola University Law
School. From 2002 to March 2014, Ms. Boulet served as Special
Counsel at the law firm of Adams and Reese, LLP. She also served as
President and Chief Operating Officer of IMDiversity, Inc. from
March 2002 to March 2004. Prior to 2002, Ms. Boulet was a partner
at the law firms of Phelps Dunbar, LLP, and Jones Walker. Ms.
Boulet serves as a director of W&T Offshore, Inc (WTI:NYSE),
the Chairperson of its Nominating and Corporate Governance
Committee and on its Audit and Compensation committees. Ms. Boulet
received a B.A. from Yale University, and a J.D., cum laude, from
Tulane University.
Ernest Maddock served as Chief Financial Officer of
Micron Technology, Inc. from 2015 until his retirement in 2018.
Prior to that, he served as Executive Vice President and Chief
Financial Officer of Riverbed Technology, Inc. from 2013 to 2015.
From 1997 to 2013, Mr. Maddock served in various roles at Lam
Research Corporation, culminating in the position of Chief
Financial Officer from 2008 to 2013. Mr. Maddock has served on the
boards of directors of Ultra Clean Holdings Inc. (Nasdaq: UCTT)
since June 2018, Avnet (Nasdaq: AVT) since August 2021 and
Terdadyne (Nasdaq:TER) since November 2022. Mr. Maddock previously
served on the Board of Intersil Corporation (Nasdaq: ISIL) from
2015 until its acquisition in 2017. Mr. Maddock received a BS in
Industrial Management from the Georgia Institute of Technology and
an MBA with a specialization in Finance from Georgia State
University.
Kristin Slanina has served as a member of Velodyne
Lidar’s board of directors since July 2021, and serves on
Velodyne’s Audit Committee and Nominating and Corporate Governance
Committee. Ms. Slanina is the Chief Innovation Officer at
ParkMyFleet, a provider of parking locations and technology
solutions for fleet operations, a position she has held since March
2021. Previously, she served as Chief Operating Officer of TrueCar,
an automotive pricing and information website for new and used car
buyers, from September 2020 to March 2021 where she led the newly
formed solutions group and helped the company accelerate into its
next phase of growth. Before TrueCar, she was Chief Transformation
Officer of Thirdware Consulting, an IT consulting organization,
from January 2019 to September 2020, where she led the Emerging
Technology group and paved the way for Thirdware’s status as a Tier
1 partner with Ford and other OEMs on vehicle software development,
machine learning and blockchain technology. Prior, Ms. Slanina has
held roles of increasing responsibility at Ernst & Young, a
global professional services firm, and Fiat Chrysler Automobiles, a
manufacturer of automobiles, after spending the first 18 years of
her career at Ford Motor Company, beginning as a powertrain
engineer. Ms. Slanina has served on the Board of Comstock Inc.
(NYSE MKT: LODE) since May 2022. She holds an M.S. and a B.S. in
Mechanical Engineering from Massachusetts Institute of
Technology.
About Ouster
Ouster (NYSE: OUST) is building a safer and more sustainable
future through its high-resolution digital lidar sensors for the
automotive, industrial, smart infrastructure, and robotics
industries. Ouster’s sensors offer an excellent combination of
price and performance with the flexibility to span hundreds of
use-cases and enable revolutionary autonomy across industries. With
a global team and high-volume manufacturing, Ouster supports
approximately 700 customers in over 50 countries. Ouster is
headquartered in San Francisco, CA with offices in the Americas,
Europe, Asia-Pacific, and the Middle East. For more information,
visit www.ouster.com, or connect with us on Twitter or
LinkedIn.
About Velodyne
Velodyne (Nasdaq: VLDR) ushered in a new era of autonomous
technology with the invention of real-time surround view lidar
sensors. Velodyne, a global leader in lidar, is known for its broad
portfolio of breakthrough lidar technologies. Velodyne’s
revolutionary sensor and software solutions provide flexibility,
quality and performance to meet the needs of a wide range of
industries, including autonomous vehicles, advanced driver
assistance systems (ADAS), industrial, intelligent infrastructure
and robotics. Through continuous innovation, Velodyne strives to
transform lives and communities by advancing safer mobility for
all. For more information, visit www.velodynelidar.com.
Cautionary Statement Regarding
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the federal securities law. Such statements are
based upon current plans, estimates and expectations of the
management of Ouster and Velodyne that are subject to various risks
and uncertainties that could cause actual results to differ
materially from such statements. The inclusion of forward-looking
statements should not be regarded as a representation that such
plans, estimates and expectations will be achieved. Words such as
“anticipate,” “expect,” “project,” “intend,” “believe,” “may,”
“will,” “should,” “plan,” “could,” “continue,” “target,”
“contemplate,” “estimate,” “forecast,” “guidance,” “predict,”
“possible,” “potential,” “pursue,” “likely,” and words and terms of
similar substance used in connection with any discussion of future
plans, actions or events identify forward-looking statements. All
statements, other than historical facts, including statements
regarding the timing of the Special Meeting; the anticipated Board
designees and Board composition of the combined company following
the closing of the proposed merger; Ouster’s and Velodyne’s
anticipated financial results for the year ended December 31, 2022;
the expected timing of the closing of the proposed merger; the
ability of the parties to complete the proposed merger considering
the various closing conditions; the expected benefits of the
proposed merger, including estimations of anticipated cost savings;
the competitive ability and position of the combined company; and
any assumptions underlying any of the foregoing, are
forward-looking statements. Important factors that could cause
actual results to differ materially from Ouster’s and Velodyne’s
plans, estimates or expectations could include, but are not limited
to: (i) the risk that the proposed merger may not be completed in a
timely manner or at all, which may adversely affect Ouster’s and
Velodyne’s businesses and the price of their respective securities;
(ii) uncertainties as to the timing of the consummation of the
proposed merger and the potential failure to satisfy the conditions
to the consummation of the proposed merger, including obtaining
stockholder and regulatory approvals; (iii) the proposed merger may
involve unexpected costs, liabilities or delays; (iv) the effect of
the announcement, pendency or completion of the proposed merger on
the ability of Ouster or Velodyne to retain and hire key personnel
and maintain relationships with customers, suppliers and others
with whom Ouster or Velodyne does business, or on Ouster’s or
Velodyne’s operating results and business generally; (v) Ouster’s
or Velodyne’s respective businesses may suffer as a result of
uncertainty surrounding the proposed merger and disruption of
management’s attention due to the proposed merger; (vi) the outcome
of any legal proceedings related to the proposed merger or
otherwise, or the impact of the proposed merger thereupon; (vii)
Ouster or Velodyne may be adversely affected by other economic,
business, and/or competitive factors; (viii) the occurrence of any
event, change or other circumstances that could give rise to the
termination of the merger agreement and the proposed merger; (ix)
restrictions during the pendency of the proposed merger that may
impact Ouster’s or Velodyne’s ability to pursue certain business
opportunities or strategic transactions; (x) the risk that Ouster
or Velodyne may be unable to obtain governmental and regulatory
approvals required for the proposed merger, or that required
governmental and regulatory approvals may delay the consummation of
the proposed merger or result in the imposition of conditions that
could reduce the anticipated benefits from the proposed merger or
cause the parties to abandon the proposed merger; (xi) risks that
the anticipated benefits of the proposed merger or other commercial
opportunities may otherwise not be fully realized or may take
longer to realize than expected; (xii) the impact of legislative,
regulatory, economic, competitive and technological changes; (xiii)
risks relating to the value of the Ouster shares to be issued in
the proposed merger; (xiv) the risk that integration of the
proposed merger post-closing may not occur as anticipated or the
combined company may not be able to achieve the growth prospects
and synergies expected from the proposed merger, as well as the
risk of potential delays, challenges and expenses associated with
integrating the combined company’s existing businesses; (xv)
exposure to inflation, currency rate and interest rate fluctuations
and risks associated with doing business locally and
internationally, as well as fluctuations in the market price of
Ouster’s and Velodyne’s traded securities; (xvi) the impact of the
COVID-19 pandemic on Ouster’s and Velodyne’s business and general
economic conditions; (xvii) the market for and adoption of lidar
and related technology and the combined company’s ability to
compete in a market that is rapidly evolving and subject to
technological developments; (xviii) the impact of cost increases
and supply chain shortages in the components needed for the
production of lidar products and related technology; and (xix) the
unpredictability and severity of catastrophic events, including,
but not limited to, acts of terrorism or outbreak of war or
hostilities, as well as Ouster’s and Velodyne’s response to any of
the aforementioned factors. Additional factors that may affect the
future results of Ouster and Velodyne are set forth in their
respective filings with the United States Securities and Exchange
Commission (the “SEC”), including each of Ouster’s and Velodyne’s
most recently filed Annual Reports on Form 10-K, subsequent
Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and
other filings with the SEC, which are available on the SEC’s
website at www.sec.gov. See in particular Ouster’s Annual Report on
Form 10-K for the fiscal year ended December 31, 2021 in Part I,
Item 1A, “Risk Factors,” as updated by Ouster’s most recent
Quarterly Report on Form 10-Q in Part II, Item 1A, “Risk Factors”
and Velodyne’s Quarterly Report on Form 10-Q for the quarter ended
June 30, 2022, in Part I, Item 1A, “Risk Factors.” The risks and
uncertainties described above and in the SEC filings cited above
are not exclusive and further information concerning Ouster and
Velodyne and their respective businesses, including factors that
potentially could materially affect their respective businesses,
financial conditions or operating results, may emerge from time to
time. Readers are urged to consider these factors carefully in
evaluating these forward-looking statements, and not to place undue
reliance on any forward-looking statements. Any such
forward-looking statements represent management’s reasonable
estimates and beliefs as of the date of this press release. While
Ouster and Velodyne may elect to update such forward-looking
statements at some point in the future, they disclaim any
obligation to do so, other than as may be required by law, even if
subsequent events cause their views to change.
Financial Disclosure Advisory
Ouster and Velodyne report 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 and Velodyne’s management,
as financial closing procedures for the quarter and year ended
December 31, 2022 are not yet complete. These estimates are not a
comprehensive statement of either company’s financial results for
the year ended December 31, 2022 and 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 internal control over financial reporting, the
completion of the audit of the 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.
Additional Information
In connection with the proposed merger Velodyne has filed with
the SEC and mailed or otherwise provided to its stockholders a
joint proxy statement/prospectus regarding the proposed merger (as
amended or supplemented from time to time, the “Joint Proxy
Statement/Prospectus”). INVESTORS AND VELODYNE’S STOCKHOLDERS ARE
URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS AND ANY OTHER
DOCUMENTS FILED BY EACH OF OUSTER AND VELODYNE WITH THE SEC IN
CONNECTION WITH THE PROPOSED MERGER OR INCORPORATED BY REFERENCE
THEREIN BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE
PROPOSED MERGER AND THE PARTIES TO THE PROPOSED MERGER. Investors
and stockholders may obtain a free copy of the Joint Proxy
Statement/Prospectus and other documents containing important
information about Ouster and Velodyne from the SEC’s website at
www.sec.gov. Ouster and Velodyne make available free of charge at
www.ouster.com and www.velodynelidar.com, respectively (in the
“Investors” section), copies of materials they file with, or
furnish to, the SEC.
No Offer or Solicitation
This communication shall not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be
any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
No offering of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the U.S.
Securities Act of 1933, as amended.
Participants in the Solicitation
Ouster, Velodyne and their respective directors, executive
officers and certain employees and other persons may be deemed to
be participants in the solicitation of proxies from the
stockholders of Velodyne in connection with the proposed merger.
Securityholders may obtain information regarding the names,
affiliations and interests of Ouster’s directors and executive
officers in Ouster’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2021, which was filed with the SEC on February
28, 2022, and its definitive proxy statement for the 2022 annual
meeting of stockholders, which was filed with the SEC on April 27,
2022. Securityholders may obtain information regarding the names,
affiliations and interests of Velodyne’s directors and executive
officers in Velodyne’s definitive proxy statement for the 2022
annual meeting of stockholders, which was filed with the SEC on
April 29, 2022. Additional information regarding the interests of
such individuals in the proposed merger are included in the Joint
Proxy Statement/Prospectus relating to the proposed merger filed
with the SEC. These documents (when available) may be obtained free
of charge from the SEC’s website at www.sec.gov, Ouster’s investor
website at https://investors.ouster.com/ and Velodyne’s investor
website at https://investors.velodynelidar.com/.
1 Cash balance includes cash, cash equivalents, restricted cash
and short-term investments as of December 31, 2022.
2 As previously disclosed, the Hercules debt facility requires a
minimum $60 million cash balance be maintained by the combined
company or the combined company would be obligated to repay the
credit debt facility. Advances under the Loan Agreement bear
interest at the rate of interest equal to greater of either (i) (x)
the prime rate as reported in The Wall Street Journal plus (y)
6.15%, and (ii) 9.40%, subject to compliance with financial
covenants and other conditions.
3 Billings represents the dollar value of products and services
provided during the current period and invoiced to the customer.
Management uses this metric to track commercial growth, establish
performance targets and make budgetary and operating decisions.
Billings excludes the effect of the contra revenue recognized in
connection with the Amazon warrants.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230201006152/en/
Ouster:
For Investors Sarah Ewing investors@ouster.io
For Media Heather Shapiro press@ouster.io
Velodyne:
For Investors Jordan Darrow/Darrow Associates
InvestorRelations@velodyne.com
For Media Jane Maynard PR@velodyne.com
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