Uber‘s self-driving unit, Superior Applied sciences Group (ATG), is being acquired by its start-up competitor Aurora Innovation, the businesses introduced Monday.

The deal, anticipated to shut within the first quarter of 2021, values ATG at roughly $4 billion. The unit was valued at $7.25 billion in Apr. 2019 when Softbank, Denso and Toyota took a stake.

Uber CEO Dara Khosrowshahi will be part of the corporate’s board, and the ride-sharing big will make investments $400 million into the corporate.

General, Uber and ATG buyers and workers are anticipated to personal a 40% stake in Aurora, in accordance with a regulatory submitting accompanying the deal; Uber alone will maintain a 26% stake. The beginning-up is being valued at $10 billion within the transaction, in accordance with an individual conversant in the phrases of the deal.

“With the addition of ATG, Aurora can have an extremely sturdy group and expertise, a transparent path to a number of markets, and the sources to ship,” Chris Urmson, co-founder and CEO of Aurora, stated in an announcement. “Merely put, Aurora would be the firm finest positioned to ship the self-driving merchandise essential to make transportation and logistics safer, extra accessible, and cheaper.”

“Few applied sciences maintain as a lot promise to enhance individuals’s lives with protected, accessible, and environmentally pleasant transportation as self-driving automobiles,” stated Uber CEO Khosrowshahi in an announcement. “For the final 5 years, our phenomenal group at ATG has been on the forefront of this effort—and in becoming a member of forces with Aurora, they’re now in pole place to ship on that promise even sooner.”

TechCrunch first reported in November that the 2 corporations had been in talks for ATG.

Aurora is backed by Hyundai, Amazon and main enterprise corporations together with Greylock and Sequoia.

ATG had been a long-term play for Uber, however the unit introduced excessive prices and safety challenges. All through the course of a pandemic-stricken 12 months, Uber has made efforts to stem losses in its trip hailing enterprise, management enterprise prices — together with with main layoffs within the spring — and to develop its supply enterprise.

Earlier this 12 months, Uber stirred up controversy by transferring Bounce, its electrical bike sharing subsidiary, to Lime — one other micro-mobility firm through which the trip hail big had invested. Uber acquired Bounce outright in 2018 with the said intention of working and rising that model independently.

— CNBC’s Lora Kolodny contributed to this report.

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