Osler, Bennett Jones, Davies acting as legal counsel
Xanadu Quantum Technologies, a Toronto-based leader in photonic quantum computing, is set to become the first publicly traded pure-play photonic quantum computing company. The move comes as part of a merger with Crane Harbor Acquisition Corp., a special purpose acquisition company (SPAC), and a newly formed entity.
The deal values Xanadu at a pre-money equity value of US$3.0 billion, with the combined company’s pro forma enterprise value estimated at US$3.1 billion and a market capitalization of US$3.6 billion. The transaction is expected to deliver roughly US$225 million from Crane Harbor’s trust account, assuming no redemptions by shareholders, and an additional US$275 million from a private investment in public equity (PIPE) at US$10 per share, backed by strategic and institutional investors.
Founded in 2016, Xanadu has established itself as a major player in quantum hardware and software. The company is also behind PennyLane, an open-source software library for quantum computing and application development.
Xanadu made headlines in 2022 when it became the first pure-play quantum company to demonstrate quantum supremacy, using its 216-qubit Borealis system. Borealis was the first quantum supremacy computer accessible via the cloud and completed a complex calculation in two minutes.
Major corporations such as Volkswagen, Mitsubishi Chemical Group, and Rolls Royce are already using Xanadu’s systems and software.
"Today marks a transformative milestone for quantum computing as we bring the leading photonic quantum platform to the public markets," Xanadu CEO Christian Weedbrook said in a statement. "Our quantum systems compute at true room temperature without cryogenics or laser cooling, while delivering the world’s first networked, modular, and scalable quantum computer and up to 10x more efficient error correction overhead than any other quantum modality. Our success extends beyond hardware innovation to software leadership through PennyLane, the quantum programming software that's training the next generation of quantum developers worldwide. With the technological foundation and an identified path to scaling fully fault tolerant computers in place, this transaction will provide us with the capital necessary to accelerate our mission of building quantum computers that are useful and available to people everywhere."
“Photonic quantum computing is the next generation compute technology poised to bring quantum to scale,” said Crane Harbor CEO Bill Fradin. “Xanadu has already demonstrated quantum supremacy and built the world's first scalable and networkable quantum computer, uniquely positioning the combined company at the forefront of one of the most promising technological frontiers of our time.”
Placement agents for the PIPE include Morgan Stanley & Co. LLC as lead placement agent, along with CIBC Capital Markets, Cohen & Company Capital Markets, and JonesTrading.
Osler, Hoskin & Harcourt LLP and Cooley LLP are serving as legal counsel to Xanadu. Bennett Jones LLP and Winston & Strawn LLP, Stevens & Lee P.C. are serving as legal counsel to Crane Harbor. Davies Ward Phillips & Vineberg LLP and Ropes & Gray LLP are advising the PIPE placement agents.
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