Applied Intuition to Buy SPAC Embark Autonomous Trucking for $71 Million
Embark Trucks, the autonomous trucking company that recently cut 70% of its workforce, is being acquired by Applied Intuition, a simulation and software provider for the development of autonomous vehicles. The all-cash transaction has a net worth of around $71 million, according to the companies.
Embark went public in 2021 via a merger with a special purpose acquisition company. Like many so-called SPACs that joined the public markets before they were mature enough, Embark has struggled to develop and commercialize its self-driving vehicle technology. In March, Embark launched the tough decision to lay off the majority of its staff and close two offices.
The remaining 30% of workers have been tasked with winding down operations, according to an email to employees from CEO Alex Rodrigues. According to a regulatory filing, this would have involved a sale of assets. In the meantime, Embark’s Board of Directors has embarked on “a process of exploring, reviewing and evaluating a range of potential strategic alternatives available to the company”, including potential dissolution or liquidation of assets, among other options.
On Thursday, Embark’s decision became clear.
Applied will integrate Embark’s internal tools, data and software assets to enhance its offerings to trucking and automotive customers. Applied claims to power the autonomy programs of “17 of the world’s top 20 automotive OEMs” – companies like General Motors, Volkswagen, Daimler and Nissan, as well as new market entrants like Motional and Einride, according to the website. Applied.
Under the terms of the agreement, which was unanimously approved by the boards of directors of both companies, key Embark employees will be absorbed into Applied to ensure a smooth transition and encourage growth. of the company’s product line.
Embark shareholders will receive $2.88 per share in cash. Embark’s stock price closed Thursday at $2.94, but quickly fell about 7% in after-hours trading. The companies expect the transaction to close in the third quarter, after which Embark shares will cease trading on the Nasdaq.
Embark Trucks was founded in 2016 by CEO Alex Rodrigues and CTO Brandon Moak, and was one of the hottest startups out there. In 2018, Embark had raised approximately $47 million. Its merger agreement with SPAC Northern Genesis Acquisition Corp. It was valued at $5.2 billion.
Despite high hopes, Embark found itself short of capital, reporting approximately $190 million in cash and cash equivalents at the end of the third quarter of 2022. Today, Embark’s market capitalization is approximately $70 million, down $20 million from just two months ago.
The acquisition comes just months after Applied acquired another company, SceneBox, which built a data management and operations platform specifically for machine learning. Late last year, the company also secured a two-year, $49 million contract with the Army and Defense Innovation Unit to provide a development and test platform. autonomy software for the army’s robotic combat vehicle program.