Bird has filed for Chapter 11 bankruptcycapping off a tumultuous year for the electric scooter company.
In a Press release Today, Bird confirmed that it had entered a “financial restructuring process aimed at strengthening its balance sheet”, with the company continuing to operate as normal in pursuit of “long-term, sustainable growth”.
Founded in 2017 by former Lyft and Uber executive Travis VanderZanden, Bird is one of a number of startups introducing offline micromobility platforms around the world, allowing city dwellers to pay for short-term access to electric scooters or bicycles . The company went public in late 2021 through a SPAC merger, but in a frenzied market based on questionable financials, its stock has been in perpetual decline, with its market capitalization falling from more than $2 billion at its IPO of New York (NYSE). to just $70 million 12 months later. This decline led the NYSE to issue a warning that Bird’s stock price was too low.
Things didn’t improve, and with the stock price continuing to slide, CEO VanderZanden left in June with the company eventually delisted from the NYSE In September.
Separately, Bird also announced a round of layoffs shortly after buying rival Spin for $19 million.
The bird lands on the NYSE Image credits: Spencer Platt/Getty Images
Chapter 11
A Chapter 11 bankruptcy would allow Bird to restructure its finances without disrupting day-to-day operations, with Apollo Global Management’s MidCap Financial division among existing lenders providing $25 million in financing through the bankruptcy process.
The ultimate goal is to sell Bird’s assets, with a so-called “stalking horse” deal launching a bidding process designed to extract as much value from Bird as possible, with its lenders setting a base offer before opening things up to outside suitors over the next four months.
Interim CEO Michael Washinushi will continue in his role before and after the restructuring, according to the announcement.
“This announcement represents a major milestone in Bird’s transformation, which began with the appointment of new leadership earlier this year,” said Washinushi. “We are moving towards profitability and aim to accelerate that progress by right-sizing our capital structure through this restructuring. We remain focused on our mission to make cities more sustainable by using micromobility to reduce car use, traffic and carbon emissions.”
It’s also worth noting that Bird’s operations in Canada and Europe are not part of this bankruptcy and “will continue to operate as normal,” the company said.
This latest news comes just a day after competitor Micromobility.com was delisted from Nasdaq due to its depressed share price, three years after it too went public through a SPAC merger. And in Europe, dockless scooter start-up Tier recently laid off 22% of its workforce, which followed the bankruptcy process of Dutch e-bike company VanMoof.
All in all, then, it hasn’t been a great year for the micromobility realm.
