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Fourth Lidar Company Goes Public With Innoviz SPAC Deal: What Investors Should Know

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Fourth Lidar Company Goes Public With Innoviz SPAC Deal: What Investors Should Know

A fourth lidar company is going public via a special purpose acquisition company, with Innoviz Technologies being the latest to announce a merger.

The SPAC Deal: Innoviz Technologies will go public via a merger with the SPAC Collective Growth Corporation (NASDAQ: CGRO).

The deal was done at an equity value of $1.4 billion. The PIPE included Magna International (NYSE: MGA), a tier one automotive supplier and current investor.

The new company will trade as "INVZ" on the NASDAQ. Shareholders of Collective Growth Corporation will own 11% of the new company. The deal is expected to close in the first quarter of 2021.

Related Link: Ford Reports 7.6% Stake In Newly Public Velodyne Lidar

About Innoviz: Innoviz is a global leader in lidar sensors, with a focus on the consumer vehicle market. The consumer vehicle market makes up two-thirds of the lidar total addressable market in the near-term, according to the company.

Innoviz was the first company to win an OEM production contract for L3 lidar. The company sees the L2+ lidar market as the largest opportunity over the next five years.

The company's partners include Magna International Inc. (NYSE: MGA), Aptiv (NYSE: APTV), Samsung, Softbank and BMW.

The company’s InnovizTwo is its latest product and comes with a 70% cost reduction from the prior release. 

Future growth will come in robotaxis, delivery vehicles, drones, security, surveillance and internet of things, the company said. 

Innoviz Financials: Revenue for Innoviz is expected to be $5 million in 2020. The company sees revenue growing by triple digits annually beginning in 2021.

Revenue estimates for the next five fiscal years are $9 million, $23 million, $79 million, $237 million and $581 million, respectively.

Innoviz has global manufacturing capabilities and a supply chain already in place.

Lidar Competition: Innoviz is the fourth company to seek a SPAC to take its lidar business public.

Luminar Technologies (NASDAQ: LAZR) and Velodyne Lidar (NASDAQ: VLDR) both completed their SPAC mergers. Aeva is going public via a merger with InterPrivate Acquisition Corp (NASDAQ: IPV).

Luminar shares trade over $30 and Velodyne shares are at nearly $20 at the time of writing. InterPrivate shares are around $14.

The presentation shows comparisons between the four lidar companies. The 171% CAGR from 2023 to 2025 from Innoviz is second highest, trailing only Aeva. Innoviz has the lowest projected gross profit margins of the four.

The valuation of Innoviz values the company at 1.8x EV/2025 estimated revenue. That compares to 14.5x for Luminar, 3.2x for Aeva and 5.2x for Velodyne (2024 revenue estimate used).

Price Action: Shares of Collective Growth Corp. were up 2.12% at $13.50 at last check Friday. Shares crossed the $17 level in premarket trading on the deal announcement.

 

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