Cepton, a Silicon Valley-based tech innovator and leader in high-performance automotive lidar solutions, has raised into a binding agreement for a $100 million investment from its long-term automotive Tier 1 partner and current shareholder, Koito Manufacturing Co., Ltd. The investment will be used to fund Cepton’s next phase of growth as it scales its lidar solutions for mass deployment.
Since 2017, Cepton and Koito have had a strong history of collaboration, and this marks Koito’s third investment in Cepton since 2020. As a direct result of their partnership, Cepton and Koito were awarded the industry’s largest known ADAS lidar series production award.
The investment is expected to close in the first quarter of 2023. More information regarding the investment and key terms of the Preferred Stock will be included in a Form 8-K to be filed by Cepton with the Securities and Exchange Commission.
$100M investment agreement
As per the Investment Agreement approved by Cepton’s board of directors, Koito will purchase $100 million of convertible preferred stock with a purchase price of $1,000 per share. It will be convertible, beginning on the first anniversary of the issue date into shares of Cepton’s common stock at an approximate initial conversion price of $2.585 per share.
The initial conversion price represents a 13.4% premium to Cepton’s closing price on October 26, 2022 and a 7.0% premium to Cepton’s average closing price over the past five trading days. At Cepton’s election, the Preferred Stock carries a 4.250% per annum dividend if paid in kind or a 3.250% per annum dividend if paid in cash, in each case paid quarterly in arrears.
“We are excited to further strengthen our partnership with Koito and remain deeply grateful for Koito’s continued support. This investment solidifies Cepton’s financial position, and allows us to continue our execution excellence as we focus on commercialisation and mass-market deployment of our lidar sensors,” said Dr. Jun Pei, Cepton’s Co-Founder and CEO.
“We are pleased to announce our third investment in Cepton as we work towards developing and commercialising next-generation automotive sensor technologies. Our partnership has developed over the years and Cepton remains a critical partner for us. This investment serves as a testament to our commitment towards Cepton and bringing lidar-based ADAS and AV systems to everyday vehicles,” said Mr. Michiaki Kato, Koito’s President.
Develops lidar-based solutions
Cepton was founded in 2016 by Dr. Jun Pei and Dr. Mark McCord. It is a developer of lidar-based solutions that help enable ADAS, autonomous vehicles, smart cities, smart spaces, and smart industrial applications. LiDAR (Light Detection and Ranging) is said to be the most important of the sensor suite enabling different levels of driver autonomy. The company’s products are currently used in a variety of use cases including monitoring airport terminals, enhancing efficiency at highway tolling stations/railways, and securing high-value infrastructure.
Cepton was built to address key lidar industry challenges for mass market adoption. The company’s portfolio of proprietary technology is uniquely aimed at facilitating this industry’s growth through a combination of performance, reliability, affordability, and design integration.
Headquartered in San Jose, California, the company newly opened a Center of Excellence in Metro Detroit, Michigan, and an international presence spanning North America, Germany, Japan, India, and China.
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