LiDAR company Luminar has filed for Chapter 11 bankruptcy protection after months of layoffs, executive departures and a legal battle with its largest customer, Volvo.
The company aims to sell its lidar business during bankruptcy proceedings and has already reached an agreement to sell its semiconductor subsidiary. The company will remain open during the bankruptcy process to “minimize disruption” to suppliers and customers, but Luminar will ultimately cease to exist once the bankruptcy process is complete.
“After a comprehensive review of our company’s alternatives, our board of directors determined that a court-supervised sale process is the best path forward,” Luminar CEO Paul Rich said in a statement. “As we move forward with this process, our top priority is to continue to provide the same quality, reliability and service that our customers have come to expect from us.”
The bankruptcy case, filed Monday morning in the Southern District of Texas, comes at the end of a tumultuous year for the company, which was valued at more than $3 billion when it went public in a reverse merger in 2020.
Luminar founder Austin Russell abruptly stepped down as CEO in May following a “corporate conduct and ethics investigation,” although he remained on the company’s board of directors. In October, he launched a new initiative called Russell AI Labs and made an offer to acquire Luminar outright.
A Russell AI Labs spokesperson told TechCrunch that Russell plans to make a bid for Luminar’s remaining assets during bankruptcy proceedings.
“For the past three months, at the invitation of certain key stakeholders, including members of Luminar’s board of directors, Russell AI Lab has been working with Luminar on a proposal to partner with a leading technology company to provide a landing spot for the company and preserve and create shareholder value. Unfortunately, as today’s events demonstrate, they ended up going in different directions,” the spokesperson said.
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“While it has been difficult to have Mr. Russell on the sidelines, we believe Russell AI Lab can create tremendous value with Luminar’s technology platform, restore key customer relationships, advance our mission to save millions of lives, and build a stronger business than ever before,” they continued.
Meanwhile, the company cut its workforce by 25%, marking its second layoff this year. Luminar’s chief financial officer left the company, the company defaulted on numerous loans, and the Securities and Exchange Commission launched an investigation.
Luminar was also hit with an eviction lawsuit at one office in October and terminated the lease at another office in November.
Another big blow came in November when Volvo, an early backer of Luminar and its biggest customer heading into this year, terminated its five-year contract with the lidar maker. Luminar said it has taken legal action against Volvo over the breakup, but it also has its own legal claims from the contract manufacturer that actually made the lidar sensor.
According to its bankruptcy filing, Luminar claims assets of $100 million to $500 million and debts of $500 million to $1 billion. These debts include a $10 million debt to Scale AI, which was helping Luminar label its data. Luminar also owes AI software company Applied Intuition more than $1 million.
This article has been updated with a statement from Russell AI Labs.
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