Good morning, everyone. My name is Sarah Ewing, and I'm the Director of Investor Relations at Ouster. Welcome to the joint webcast regarding the proposed merger of Ouster, Inc. and Velodyne Lidar, Inc. This webcast will remain available on the Ouster and Velodyne investor relations website following the conclusion of these prepared remarks. I'm joined today by Ouster Chief Executive Officer Angus Pacala and Velodyne Chief Executive Officer Dr. Ted Tewksbury. Before we begin the prepared remarks, we would like to remind you that Ouster and Velodyne issued a joint press release announcing the proposed merger early this morning. Both companies also published a joint investor presentation, which is available on the investor relations sections of ouster.com and velodyne.com.
I'd also like to remind everyone that during the course of this conference call, the management of Ouster and Velodyne will discuss the proposed merger and other forward-looking statements regarding the combined company, including the expected timing of the closing of the proposed transaction, the expected benefits of the proposed transaction, the cash position of the combined company, and timeline to achieve profitability and the competitive ability and position of the combined company, all of which is intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 for forward-looking statements. While these statements represent management's expected future results and performance, the actual results of Ouster, Velodyne in the combined company are subject to many risks and uncertainties that could cause actual results to differ materially from current expectations that we may share with you today.
In addition to any risks highlighted during this call, you should consider the important risk factors and other disclosures that may affect Ouster's and Velodyne's, and if applicable, the combined company's future results as described in their most recent annual reports on Form 10-K and other reports Ouster or Velodyne files with or furnishes to the SEC, and when available, a registration statement that will include a joint proxy statement/prospectus relating to the proposed transaction. Except as required by law, rule, or regulation, Ouster and Velodyne undertake no obligation to update any of these forward-looking statements for any reason after the date of this call. Lastly, information discussed on this call concerning the industry, competitive position, and the markets in which Ouster and Velodyne operate is based on information from independent industry and research organizations, other third-party sources, and management estimates.
Management estimates are derived from publicly available information released by independent industry analysts and other third-party sources, as well as data from the internal research of Ouster or Velodyne, and are based on reasonable assumptions and computations made upon reviewing such data and management's experience in and knowledge of such industry and markets. By definition, assumptions are subject to uncertainty and risk, which could cause results to differ materially from those expressed in the estimates. In connection with the proposed transaction, Ouster and Velodyne intend to file documents with the SEC, including a registration statement on Form S-4 containing a joint proxy statement and prospectus. Investors and security holders are urged to read carefully the joint proxy statement/prospectus when it is filed with the SEC and other documents filed by either company with the SEC relating to the proposed transaction when they are filed because they will contain important information.
I would now like to turn the call over to Ouster CEO, Angus Pacala, and Velodyne CEO, Ted Tewksbury.
Thanks, Sarah, and good morning. Earlier today, we announced the proposed merger of Ouster and Velodyne in an all-stock transaction that is expected to drive significant value creation for our combined customers, shareholders, and company. With the proposed merger of our two companies, we have an incredible opportunity to transform the multi-billion dollar market for sensing technologies across automotive, industrial, robotics, and smart infrastructure applications as we work to usher in a new age of autonomy powered by affordable and performant LiDAR technology. Ouster's cutting-edge digital LiDAR technology, evidenced by strong unit economics and the performance gains of our new products, complemented by Velodyne's decades of innovation, high-performance hardware and software solutions, and established global customer footprint, positions the combined company to accelerate the adoption of LiDAR technology across fast-growing markets with a diverse set of customer needs.
This will enable us to deliver the performance customers demand while achieving price points low enough to promote mass adoption. With Ted Tewksbury as executive chair of the board and me continuing on as CEO, we will work hand in hand to lead a breakaway LiDAR company with deep expertise, industry-leading technology, a world-class commercial organization, and a strong balance sheet. I'm confident that our proposed merger with Velodyne is the best way to strategically build scale to achieve sustainable and profitable growth and maximize the value of our respective businesses.
Thank you, Angus. I couldn't agree more. We believe that this proposed merger is the best opportunity for both of our companies to increase long-term shareholder value by creating a unified company with an optimized business model, strengthened cash position, dynamic growth opportunity, and enormous operational efficiencies to drive the combined company toward profitability. As both companies have expressed many times, LiDAR is an increasingly important technology for autonomy, given its ability to dramatically improve the efficiency, productivity, safety, and sustainability of a world in motion. The combined company will aim to foster a healthy LiDAR industry by offering both affordable, high-performance sensors to drive mass adoption across diverse customer applications, and by creating enough scale to reduce product costs and drive sustainable revenue growth. Velodyne developed and manufactured the first high-performance 3D LiDAR and spawned an entire industry.
With our broad portfolio, Velodyne has shipped well over 73,000 sensors to date. We also recently augmented our sensors with AI, software, and analytics capabilities to provide full solutions to accelerate our customers' development of autonomous systems. Meanwhile, Ouster has made significant advancements in chip and sensor technologies to lower the cost of LiDAR, making it more affordable across a broad range of applications. As a result, Ouster enjoys among the highest gross margins in the LiDAR industry today and has quickly scaled the adoption of their technology with approximately 16,000 sensors shipped to date. The combination of Ouster and Velodyne is highly complementary. Through anticipated operational synergies, technological innovation, and streamlined organizational best practices, we expect the combined company to significantly improve its financial performance and product development faster than either of the two companies could achieve independently.
We are excited to be part of the first major merger in the LiDAR industry. I look forward to Velodyne combining forces with Ouster to continue to serve our customers with innovative and affordable LiDAR solutions as they transition to high-volume commercial production and to pursue the addressable opportunities for LiDAR within the vast and expanding market for sensing technologies. I'll now turn the call back over to Angus to walk through our deal rationale in more detail.
Thanks, Ted. I'm excited for the opportunity to leverage both of our companies' strengths to create a solid business foundation with more expansive commercial reach and an innovative technology roadmap. Together, Ouster and Velodyne will hold one of the most attractive IP positions in and around 3D LiDAR, with 173 granted and 504 pending patents, all backed by over 20 years of combined experience in LiDAR. With best-in-class hardware and verticalized software solutions, our combined company will be able to provide greater value to customers across a wide range of fast-growing end markets and drive accelerated innovation as our teams collaborate to build a LiDAR product roadmap that will provide tremendous benefits to customers. Building a software ecosystem will continue to be an important part of our product roadmap to catalyze growth.
This software ecosystem will include best-in-class tools to simplify development for our customers, accelerate their time to market, and lower the barrier of entry for new target markets. With an expanded global commercial footprint and distribution network, we expect the combined company will also drive increased volumes and subsequently reduce product costs more rapidly. Further, our unified global success team will be able to provide top-tier support to our many customers, distributors, and partners. These offerings are essential to our ability to drive scale and compete in the large and fast-growing market for sensing technologies, which include more established technologies like cameras, radar, GPS, and other sensor modalities. Ted will now cover our combined expected financial synergies and the transaction details.
The combination of Ouster and Velodyne is expected to unlock significant synergies, creating a company with the scale and resources to deliver valuable solutions for customers and society while accelerating time to profitability and enhancing value for shareholders. We plan to streamline operational expenditures to build an overall cost structure that is in line with the projected growth of the combined company. As of September 30th, 2022, the combined cash balance of our two companies was approximately $355 million. Through this merger, our combined financials would be supported by significant synergies across operational expenditures. Based on stand-alone cost structures as of September 30th, 2022, we expect to realize at least $75 million in annualized operational expenditure synergies within nine months after the transaction close. Overall, this proposed merger accelerates our ability to one, reduce product costs through volume purchasing and scaled manufacturing.
Two, develop a combined product roadmap of low-cost performant sensors that aligns with the future needs of the market. Three, cast a wider net to reach a broader set of customers. Four, strengthen our competitiveness against other established sensing modalities like cameras and radar. Turning to the deal itself, under the terms of the merger agreement signed on November fourth, each Velodyne share will be exchanged for 0.8204 shares of Ouster at closing. The transaction will result in existing Velodyne and Ouster shareholders each owning approximately 50% of the combined company. We expect a closing date in the first half of 2023, after which we will be able to provide the market with additional details about our combined company strategy.
As Angus stated, he will lead the combined company as chief executive officer, and I will take on the role of executive chairman of the board. The combined company's board will be comprised of eight members, with each company appointing an equal number of members. A full list of board members and executive leadership will be announced at a later date. The proposed merger is subject to customary closing conditions, including shareholder approval of the transaction by Velodyne and Ouster. Each company will continue to operate their businesses separately and independently until the close of the merger. Angus, back to you for closing remarks.
I've followed Velodyne since the very beginning and have been impressed by them more than any other LiDAR company currently in the market. They founded the 3D LiDAR industry and kickstarted a broader education with customers and the public on the role LiDAR can and will play in our society. They built the first high-performance sensors and amassed a strong base of talented employees, customers with real-world deployments, and partners around the world. This makes Velodyne the ideal company for Ouster to merge with to accelerate the adoption of affordable performant LiDAR technology and solutions. Together, we'll have the resources, technology, team, and commercial strategy to build a safer and more sustainable future powered by LiDAR while delivering increased value to all of our stakeholders. Thank you.