Uber sells self-driving unit to Aurora, takes stake in startup

Bloomberg

Uber Technologies Inc sold its self-driving car division to Aurora Innovation Inc and took a stake in the startup, creating a larger competitor to the leader in the field, Alphabet Inc’s Waymo.
The deal will value Aurora at $10 billion, according to people familiar with the discussions who asked not to be identified discussing private information. In exchange for investing $400 million in Aurora, Uber will get a 26% ownership stake in the company. That number increases to 40% when counting the stakes held by the employees and investors of Uber’s autonomous driving division. Uber Chief Executive Officer Dara Khosrowshahi and one other yet-to-be-named person representing Uber will join Aurora’s board.
The deal, expected to close during the first quarter, also guarantees that when Aurora releases its self-driving vehicles, they’ll launch on Uber’s network.
By adding Uber’s self-driving car unit, Aurora will gain hundreds of engineers and access to one of the world’s largest ride-hailing networks. For Uber, which has slashed high-profile cash-burning initiatives this year in a push to turn a profit in 2021, the deal will give it a significant stake in one of Silicon Valley’s most promising autonomous driving startups.
Uber’s driverless car unit, Advanced Technologies Group, is a subsidiary, created just before Uber went public last year with its own $7.25 billion valuation. Still, the project’s long time frame and high costs concerned Uber’s investors SoftBank Group Corp, Benchmark and others, who for months have been privately urging Khosrowshahi to reconsider the autonomous driving strategy. During ATG’s short history, it has made progress building and testing autonomous driving systems, but also struggled amid a damaging lawsuit brought by Waymo, a tragic pedestrian fatality caused by one of its autonomous cars and the sector-wide reckoning
that even the most basic self-driving vehicles will take
significantly more time and money to develop than previously expected.
Announcing the news in a joint statement, Aurora and Uber said the group will focus on driverless trucking first and later more complicated light vehicles carrying passengers.