Connected car company Otonomo, whose share price has plummeted since going public in 2021, has announced a reverse merger with roadside assistance technology provider Urgent.ly. The two will be combined in an all-stock transaction in which Urgently shareholders will get his 67% of the company and Otonomo shareholders will get his 33%. The stock, which used to trade on his OTMO on the Nasdaq, is now trading under the ULY ticker.
Otonomo will go public on the Nasdaq in a SPAC transaction in 2021 and was valued at $1.4 billion at the time of its debut. But the writing of it (and indeed SPAC) could have been on the wall: By the end of the first day of trading, its market cap had slumped to $1.1 billion, which definitely wasn’t the bottom: now , the company’s market cap is just over $70 million.
The transaction is expected to close in the third quarter of 2023, according to the companies.
Macroeconomic pressures, slow development and deployment of next-generation technologies such as autonomous driving systems, and a cooling technology investment market have made smart mobility technology a bumpy road. Otonomo is probably the latest victim in that pile, but it may not be the last.
We have asked how many people at Otonomo are in the deal and will update this story when we have more details on it. It states that some reductions will be made in the process.
The two companies plan to integrate their technologies and engage in what they call “cross-selling.” Urgent.ly’s investors include BMW, Jaguar Land Rover and Porsche, while Otonomo’s past investors include Avis and Alliance Holdings. SK Holdings and Bessemer. Otonomo currently offers services such as fleet management, data feeding diagnostics, mapping, traffic and safety management services. It is not the hardware provider that creates the data, but rather provides a platform that can consume and organize the data created by the vehicle. As we wrote earlier, once the data is securely collected, the platform modifies it so that companies can use it to develop apps and services for their fleets, smart cities, and individual customers. increase. The platform also enables GDPR, CCPA, and other privacy regulation compliant solutions using both personal and aggregated data.
Urgently, on the other hand, has a smaller but more focused scope. We provide technology that helps connect car owners to roadside assistance services.
One of these businesses is now much larger than the others. Earnings for 2022 are urgently estimated to put him in excess of $185 million, a 25% increase over 2021. Otonomo said he plans to report fourth-quarter and full-year earnings on Feb. 15, but the company’s revenue last quarter was just $2 million, and his ARR for the quarter was $6.7 million. This speaks to how the company has struggled in the market to deliver on the potential it promised to deliver.
After the merger, the company will have operations in 26 countries and close to 100 partnership agreements with OEM, transportation and mapping, insurance, fleet and rental divisions. In total, he covers 70 million vehicles and an estimated 80,000+ connected assistance service professionals. It also holds 36 issued and pending patents.
But it’s also very small, despite the fact that this coverage doesn’t translate directly into monetizable services. Connected cars, a $100 billion market.
The idea is that by combining our strengths, we will bring a more compelling and larger product to market and create more avenues for winning business within it.
Urgently CEO Matt Booth said in a statement: “By adding Otonomo’s mobility data, Urgently is uniquely positioned to use vehicle data and its connections to the fleet, insurance and roadside assistance sectors to deliver real-world services that improve customer experience and safety. can stand on
“The merger of Otonomo and Urgently is an exciting step for Otonomo to advance our vision to power the future of mobility and connected services.” By combining our technologies, we will provide new solutions that improve safety, security and accessibility for our customers.”
Matt Booth will continue to serve as CEO and Tim Hummeyer will serve as CFO of the combined company. Ben Volkow joins the Board of Directors as an advisor.
