Uber Sells its Self-Driving Unit to Startup Company Aurora

Uber may be known for its ride hailing, but the company has other endeavors which includes a self-driving technology unit called Uber’s Advanced Technologies Group (ATG).

That is until it announced this week that it has sold the unit to self-driving vehicle start-up Aurora Innovation.

Both companies announced the deal on Monday and it is expected to close in the first quarter of 2021. The deal values ATG at approximately $4 billion. In April of 2019 when Softbank, Toyota, and Denso took a stake, it was valued at $7.25 billion.

Uber CEO Dara Khosrowshahi will join Aurora’s board, and the company will also invest $400 million into the start-up. Aurora is getting a $10 billion valuation in the transaction according to a person familiar with the terms of the deal.

Aurora is backed by Hyundai, Amazon and major venture firms including Greylock and Sequoia. This past November a TechCrunch report had indicated that Greylock and Sequoia had been in talks to acquire the company.

As part of the deal, Uber and ATG investors and employees are expected to own a 40% stake in Aurora, according to a regulatory filing accompanying the deal. Uber alone will hold a 26% stake.

“With the addition of ATG, Aurora will have an incredibly strong team and technology, a clear path to several markets, and the resources to deliver,” said Chris Urmson, the co-founder and CEO of Aurora.

“Simply put, Aurora will be the company best positioned to deliver the self-driving products necessary to make transportation and logistics safer, more accessible, and less expensive.”

“Few technologies hold as much promise to improve people’s lives with safe, accessible, and environmentally friendly transportation as self-driving vehicles,” said Uber CEO Khosrowshahi.

“For the last five years, our phenomenal team at ATG has been at the forefront of this effort—and in joining forces with Aurora, they are now in pole position to deliver on that promise even faster.”

The acquisition will help to accelerate Aurora’s vision for the self-driving vehicle space according to a press release. ATG is “committed to rigorous testing and [has] built a strong safety culture,” and the acquisition will help “strengthen and accelerate” applications for the first Aurora Driver heavy-duty trucks as Aurora also continues working on lighter-duty projects.

The startup will undergo a strategic partnership with Uber that will connect Aurora’s technology to Uber’s network. The release said this will help boost Aurora’s capabilities in working with autonomous trucking and passenger mobility.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.