Autonomous driving technology provider Kodiak AI, Inc. has been taken public.
On Thursday, Kodiak AI commenced trading on the Nasdaq stock exchange under ticker symbols “KDK” and “KDKRW” upon merging with special purpose acquisition company (SPAC) Ares Acquisition Corp II.
Shareholders approved the deal Tuesday, with 88 percent of the votes cast in support of the business combination.
With the merger in place, Kodiak was valued at $2.5 billion. As of noon, the tech provider stock declined nearly 13 percent on its first day of trading.
The company, formerly known as Kodiak Robotics, has logged over 3 million autonomous miles, and its trucks have exceeded 3,000 hours of commercial operation.
Founded in 2018, Kodiak says it has delivered over 7,300 loads for on-highway customers including Maersk, IKEA, trucking and logistics companies J.B. Hunt and C.R. England, and tire manufacturer Bridgestone.
Kodiak’s most recent win is its partnership with automotive components manufacturer Roush Industries to deliver the first autonomous truck equipped with Kodiak’s proprietary technology.
Roush delivered the first upfitted truck to Kodiak’s biggest customer, industrial sand mining company Atlas Energy Solutions, in August. Atlas uses driverless trucks and an automated conveyor system to deliver fracking sand to well sites in the Permian Basin in western Texas and New Mexico.
As part of an initial 100-truck order, Atlas now owns and operates eight autonomous Kodiak-powered trucks so far, with both companies hoping to scale production of the vehicles to hundreds by the end of 2026.
“The transportation industry faces growing challenges, including safety risks, rising costs, and driver shortages,” said Don Burnette, founder and CEO of Kodiak in a statement. “Going public with the support of our partners at [Ares] marks an important step in Kodiak’s journey to help transform how freight moves by providing our driverless solution to customers.
Central to the driverless tech company’s value proposition is the Kodiak Driver autonomous driving system. The system is designed to help address often-cited challenges in the trucking industry and the public sector, including labor shortages, rising costs and demand for shorter delivery timelines.
Kodiak Driver uses the proprietary hardware called SensorPods to leverage light detection and ranging (LiDAR) and cameras, providing the AI-powered “driver” a full understanding of the road and environment surrounding the vehicle.
The firm sells its self-driving technology through a “driver-as-a-service” model, with fleets paying a per-mile or per-vehicle licensing fee to access trucks and support. The company retrofits the product to trucks, in a departure from traditional autonomous services that are installed within specifically designed tractors at truck manufacturers’ assembly plants.
“The Kodiak Driver is already on the road, safely and reliably delivering freight every day for paying customers without a human in the cab,” said Burnette. “Our driverless operations show that autonomy is no longer a future promise but a reality today.”
Kodiak disclosed it received more than $212.5 million from institutional investors in connection with business combination with Ares, which includes $145 million in private investment in public equity funding (PIPE) and roughly $62.9 million in trust cash.
“We originally targeted a $100 million PIPE…which we believe demonstrates our investors’ confidence in Kodiak, and positions us for long-term financial success,” Kodiak said. “With this strong foundation, we are focused on executing our strategy and solving some of the toughest challenges in the trucking industry.”
Kodiak isn’t expected to be the only self-driving software firm to hit the public markets this year. Plus Automation is undergoing a SPAC merger of its own in a $1.2 billion combination with Churchill Capital Corp IX. That deal, announced in early June, is expected to close in the fourth quarter. The combined entity will be known as PlusAI.
Plus had initially sought to go public in 2021 via a SPAC merger with Hennessy Capital Investment Corp. V in a deal that valued the company at $3.3 billion, but that transaction fell through that November.
PlusAI is aiming for commercial launch of factory-built autonomous trucks in 2027.