SoftBank-backed robotics firm Berkshire Grey to go public via $2.7 billion SPAC deal

SoftBank-backed robotics firm Berkshire Grey said on Wednesday it has agreed to go public through a merger with a blank-check firm in a deal that values the combined company at $2.7 billion.

The deal with Revolution Acceleration Acquisition Corp is expected to provide Berkshire Grey about $413 million in cash, as the maker of logistics automation systems looks to take advantage of a surge in online shopping amid the COVID-19.

Shares of Revolution Acceleration jumped by 18.8% on Wednesday following the announcement.

“Whether it’s the retail, e-commerce, grocery or package fulfillment supply chain, there’s this mission-critical need to automate it. Berkshire Grey is essential for that to happen with their best-in-class technology,” said John Delaney, chief executive of Revolution Acceleration.

Delaney, a former Congressman who launched his special purpose acquisition company (SPAC) in December, will join Berkshire Grey’s board following the transaction.

Founded in 2013 by Chief Executive Officer Tom Wagner, Berkshire develops artificial intelligence-based logistics automation systems, which are used by its customers - Walmart Inc, Target Corp and FedEx Corp - in their warehouses and distribution centers. It reported $35 million in revenue in 2020.

The proceeds from the deal include a private investment of $165 million anchored by venture capital investor Chamath Palihapitiya and funds and accounts managed by BlackRock Inc.

Palihapitiya has been one of the most prolific sponsors of SPACs, merging them with a range of companies. The former Facebook Inc executive has also taken part in PIPE (private investment in public equity) rounds of companies that went public through SPAC deals, including metal 3D printing technology provider Desktop Metal Inc, rare earths miner MP Materials Corp and electric bus manufacturer Proterra.

Current investors of Berkshire Grey, including venture capital firm Khosla Ventures, SoftBank Group Corp, Canaan Partners and New Enterprise Associates will be rolling their full equity stake into the combined entity.

SPACs are shell companies that raise money in an initial public offering (IPO) to pursue an acquisition at a later date. They serve as an alternative to a traditional IPO for companies looking to enter public markets.

Credit Suisse and J.P. Morgan served as exclusive financial advisers to Berkshire Grey and Revolution Acceleration, respectively.