On Monday (local time), US-based LiDAR sensor manufacturer Luminar Technologies Inc. sought Chapter 11 bankruptcy protection in the Southern District of Texas. This move came in the wake of losing its contract with Volvo. As per official disclosures, Luminar's assets are estimated to be in the range of $100 million to $500 million, whereas its liabilities could be as high as $500 million to $1 billion.

In an attempt to mitigate its financial woes, Luminar had earlier divested its stake in its subsidiary, Luminar Semiconductor Inc., for a cash consideration of $110 million. Additionally, the company has plans to put its LiDAR business up for sale. To facilitate smooth transactions, fund bankruptcy proceedings, and ensure the continuity of daily operations, an ad hoc group has consented to grant Luminar access to approximately $25 million in cash.

During the ongoing Chapter 11 bankruptcy protection process, Luminar is anticipated to maintain its business operations without interruption. Filings made on November 17 disclosed that Volvo has severed its supply chain partnership with Luminar. This decision was made after Luminar made significant compensation demands and temporarily halted the supply of certain products. On October 30, following a default on its note indenture, Luminar entered into a forbearance agreement with the majority of its bondholders.