TuSimple, a US-headquartered driverless truck producer backed by a host of corporate investors, floated yesterday in a $1.35bn initial public offering on the Nasdaq Global Select Market.
The company issued approximately 27 million class A shares priced at $40.00 each while SunDream, a vehicle for Charles Chao, chairman and CEO of internet company Sina, sold nearly 6.8 million additional shares.
The price range for the offering had been set at $35 to $39 and the price gave TuSimple a market capitalisation of approximately $8.53bn. Classic Elite and entities affiliated with Perry Creek Capital Partners are providing another $35m for the company through a concurrent private placement.
Investment and financial services group Fidelity, funds and accounts managed by subsidiaries of BlackRock and one or more funds managed by Capital World Investors had expressed an interest in buying up to 3.38 million shares in the IPO but have not confirmed whether they did so.
Founded in 2015, TuSimple is developing self-driving vehicles from bases in the US states of Arizona, New Mexico and Texas intended for land freight transportation, and expects to commercially launch them in 2024. It is pre-revenue but made a $178m net loss in 2020.
The company leverages lidar technology developed by Aeva Technologies, which listed on the New York Stock Exchange on Monday through a reverse merger. It also has partnerships with two of its investors, truck manufacturers Traton and Navistar International, which are merging with each other.
TuSimple had secured about $648m in funding prior to the IPO, having most recently completed a $350m round in December 2020 led by investment firm VectoIQ that also featured Traton, Navistar, tyre producer Goodyear, rail operators Union Pacific and CN, shipping group US Xpress and retailer Kroger.
The December round came in the wake of a $215m series D in 2019 that included contributions from car parts producer Mando and courier service United Parcel Service’s UPS Ventures unit, as well as CDH Investments and Composite Capital Management.
Venture capital firms Fuhe Capital and Zhiping Capital had provided $55m in series C funding for TuSimple in 2017, that followed more than $20m of series B funding from investors including Nvidia GPU Ventures, the corporate venturing arm of graphics processing unit manufacturer Nvidia, earlier that year.
TuSimple’s investors hold class A shares, the same type being issued in the offering, while its executives own class A and B shares. SunDream holds 13.1% of the company’s class A shares post-IPO, down from 19.6%, while Composite Capital Management has 6.1% post-IPO and Navistar 5.4%.
Citigroup, JP Morgan and Morgan Stanley are lead underwriters for the IPO while BofA Securities, Cowen, Credit Suisse, Nomura and RBC Capital Markets are book-running managers and Baird, Needham & Company, Oppenheimer, Piper Sandler and Valuable Capital are co-managers.
The underwriters have the 30-day option to acquire just over 5 million additional shares, hypothetically increasing the size of the offering to over $1.55bn.
