Making its inaugural deal, special purpose acquisition company (SPAC) Revolution Acceleration Acquisition Corp. has entered into an agreement with Berkshire Grey, which provides AI-enabled integrated robotic solutions for the supply chain.
The deal values the combined company at $2.7 billion and is expected to provide Berkshire Grey about $413 million in cash.
“My partner, Steve Case, and I are thrilled to have identified Berkshire Grey for our inaugural SPAC,” said Revolution Chief Executive Officer John Delaney.
“When Steve and I partnered to form Revolution Acceleration Acquisition Corp., our thesis was to acquire a company that is positioned to benefit from the acceleration of certain important trends in our economy. Berkshire Grey is a perfect fit. There may be no trend that is accelerating more than the transition to the digital economy.”
Founded in 2013 by Chief Executive Officer Tom Wagner, Berkshire develops artificial intelligence-based logistics automation systems, which are used by its customers in their warehouses and distribution centers. It reported $35 million in revenue in 2020 and expects to generate $59 million in revenue in 2021.
“Berkshire Grey was founded to help our customers compete even more favorably in the rapidly evolving worlds of retail and logistics,” Wagner said. “Consumer expectations have changed, putting more pressure on supply chain operations to get the right goods to the right places at the right times, as efficiently as possible.
“Over the last 12 months the pandemic amplified the already high pressure to transform, so today it is no longer a question of if companies might transform but how quickly. We are incredibly excited about this transaction, which will enable Berkshire Grey to accelerate growth and provide new and existing customers with our leading robotics solutions,” he said.
“As we all know, e-commerce is exploding and consumer expectations are changing, creating a strategic imperative to automate the supply chain across the retail, grocery and package sectors,” Delaney said, adding that Berkshire Grey is a “singular category-defining company and an extraordinary compelling investment.”
Delaney cited seven reasons why Revolution considers Berkshire Grey to be compelling:
- Best-in-class technology. (“What their robots can do is amazing,” he said.)
- Category creator.
- Huge market opportunity.
- Terrific growth, especially for the next five years.
- Can enable companies to effectively address the “Amazon Effect.”
- Already doing business with a number of blue-chip clients, including Walmart, Target and FedEx.
- Very well managed.
“Today’s consumers expect a better selection of goods, at lower prices, with shipping that is immediate,” Delaney said. “In our judgment, Berkshire Grey’s best-in-class technology and uniquely integrated solutions provide a critical pathway for companies to adapt to these changing needs.”