Cepton Inc. has secured a $100 million investment from Koito Manufacturing

Cepton Inc. announces a new investment agreement with Koito Manufacturing, enabling Cepton to scale its lidar solutions for mass deployment and more potentials.

James Davis

Cepton, Inc. ("Cepton") (Nasdaq: CPTN), a prominent Silicon Valley company specializing in cutting-edge lidar solutions, has made an announcement regarding a significant investment.

Recently, the company revealed that it has entered into a binding investment agreement dated October 27, 2022 ("Investment Agreement") with Koito Manufacturing Co., Ltd. ("Koito") (TSE: 7276), its longstanding automotive Tier 1 partner and current shareholder.

Under this agreement, Koito will invest $100 million in Cepton to support the company's upcoming growth phase, enabling the expansion of its lidar solutions for widespread adoption in various industries.

“We are excited to further strengthen our partnership with Koito and remain deeply grateful for Koito’s continued support. This investment solidifies Cepton’s financial position, and allows us to continue our execution excellence as we focus on commercialization and mass market deployment of our lidar sensors”

- Dr. Jun Pei, Cepton’s Co-Founder and CEO.

Cepton, in unanimous agreement with its board of directors, has outlined the terms of the Investment Agreement with Koito Manufacturing.

As per the agreement, Koito will acquire $100 million worth of convertible preferred stock, with each share priced at $1,000. 

The Preferred Stock will have the option to convert into shares of Cepton's common stock, starting from the first anniversary of the issue date.

The approximate initial conversion price is set at $2.585 per share, presenting a 10.0% premium to Cepton's volume-weighted average price over the preceding 20 trading days, which concluded on October 26, 2022.

Additionally, this conversion price reflects a 13.4% premium to Cepton's closing price on October 26, 2022, and a 7.0% premium to Cepton's average closing price over the past five trading days.

Cepton can choose to pay a dividend on the Preferred Stock either in cash at a rate of 3.250% per annum or in kind at a rate of 4.250% per annum, with both options paid quarterly in arrears.

This investment builds upon the strong collaborative history between Cepton and Koito, which dates back to 2017.

Notably, this marks Koito's third investment in Cepton since 2020.

The partnership between the two companies has already yielded significant results, including securing the largest known ADAS lidar series production award in the industry.

“We are pleased to announce our third investment in Cepton as we work towards developing and commercializing next-generation automotive sensor technologies. Our partnership has developed over the years and Cepton remains a critical partner for us. This investment serves as a testament to our commitment towards Cepton and bringing lidar-based ADAS and AV systems to everyday vehicles,”

- Mr. Michiaki Kato, Koito’s President.

The completion of the investment is contingent upon various factors, including the approval of Cepton's shareholders and the fulfillment of necessary closing requirements.

Anticipated to conclude in the first quarter of 2023, the investment's specific details, including key terms related to the Preferred Stock, will be disclosed in a forthcoming Form 8-K, which Cepton will file with the Securities and Exchange Commission.

Read the Press Release here:

Cepton, Inc. Announces Agreement for $100 Million Investment from Koito Manufacturing
Cepton enters into a binding investment agreement for a $100 million investment from its automotive Tier 1 partner and current shareholder, Koito.
Corporate & Finance