Shareholders for Houston-based blank-check company Industrial Tech Acquisitions Inc. (Nasdaq: ITAC) approved a deal to merge with Israeli radar technology firm Arbe Robotics, the firms announced Oct. 6.
ITAC shareholders approved the merger during a special meeting held Oct. 5, and the combination is scheduled to be completed on Oct. 7. The combined company, which will retain the Arbe Robotics name, will become publicly traded on the Nasdaq Stock Exchange on Oct. 8. Arbe's ordinary shares and warrants will trade on the Nasdaq under the ticker symbols "ARBE" and "ARBEW", respectively.
The merger was first announced in March. ITAC is a special purpose acquisition company, or SPAC, which are publicly traded companies formed to execute business combinations with existing private companies and take them public.
Arbe, headquartered in Tel Aviv, develops 4D imaging radar technology for autonomous vehicle vision and sensing. The company also has a U.S. office in Plano, north of Dallas. The company's technology has applications in other sectors, like mining, manufacturing, energy and other industrial spaces, Scott Crist said.
Crist is chairman and CEO of ITAC, as well as CEO of Houston-based technology firm Osperity, formerly Osprey Informatics, and managing partner for Houston-based venture capital firm Texas Ventures. Crist will join the Arbe board of directors in conjunction with the closing of the deal.
Crist told the Houston Business Journal he was gratified to get his first SPAC deal over the goal line.
"I'm CEO of an industrial computer vision company, so I've spent a lot of time studying computer vision, 4D radar, the lidar space. But what Arbe has developed is very complex and hard to replicate," Crist said. "We do believe that in the auto tech sector, we are ushering in a new category of sensing for the autonomous and driver-assisted industry."
Through the merger, Arbe will receive approximately $118 million in gross proceeds, including $100 million generated from a private placement of Arbe's ordinary shares. Investors in the private placement included M&G Investment Management, Varana Capital, iAngels, Texas Ventures and Eyal Waldman, the firms said. The additional $18 million will come from ITAC's public shareholders with their stock redemptions.
"Becoming a publicly traded company extends our first-mover advantage and market-leading position as we continue to spearhead a radar revolution," said Kobi Marenko, CEO of Arbe Robotics. "We continue to see strong customer uptake in our chipset as they recognize the superior capabilities of our products and significant cost advantages, and we expect that momentum to carry forward in the years ahead. The completion of the merger will help us accomplish our mission by enhancing our capital structure to fuel our product innovation process and accelerate our go-to-market strategy."
With Arbe's U.S. office located in North Texas, the company is considering growing its presence in Texas, Crist said.
"Texas is becoming somewhat of a hub for [electric vehicle] technology, battery technology," Crist said. "Between Houston, Austin, Dallas, we do believe that we're developing quite an ecosystem in the whole auto tech and EV space."
The journey of the first ITAC SPAC is effectively coming to a close, but Crist and the ITAC team have a second blank-check company in the works. Houston-based Industrial Tech Acquisitions II Inc. plans to raise $150 million through an initial public offering, according to documents filed with the U.S. Securities and Exchange Commission.
Like the first ITAC SPAC, Industrial Tech Acquisitions II plans to pursue a merger with a company in the technology industry. Crist said opportunities range from energy transition and sustainability to semiconductors to software and telecommunications.
"We're looking for leading technology companies that are at the point that they're ready to scale and, being in a public vehicle, enable them to do that more rapidly," Crist said.
Wells Fargo Securities served as exclusive financial adviser to Arbe and served as lead placement agent to ITAC on the private placement. Epsilon and Poalim Capital Markets also served as placement agents on the offering. Cowen, Roth Capital and MKM Partners acted as capital markets advisers to Arbe. DLA Piper LLP (US) served as legal adviser to Arbe, and Ellenoff Grossman & Schole LLP served as legal adviser to ITAC. Erdinast, Ben Nathan, Toledano & Co. served as Israeli legal advisers to Arbe.
source: https://www.bizjournals.com/houston/news/2021/10/06/houston-spac-itac-arbe-robotics-merger-scott-crist.html
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