|Scooter startup Bird to go public through merger with SPAC|
Bird Rides Inc. will go public by merging with a blank-check company, securing a new source of capital after venture capitalists largely lost interest in money-losing scooter rental startups.
A special purpose acquisition company called Switchback II Corp. will take Bird public and provide as much as $428 million in funding to the business. The deal has an enterprise value of about $2.3 billion, the companies said in a statement Wednesday.
The transaction includes private funding from Fidelity Investments, which had previously backed Bird, as well as a credit facility from other firms. The deal is expected to close in the third quarter. Bird is expected to trade on the New York Stock Exchange.
A former Uber Technologies Inc. executive, Travis VanderZanden, helped start Bird in 2017. It dropped electric scooters onto the sidewalks of major cities and let customers remotely unlock and rent them using an app. The model was widely copied, including by Uber, and turned Bird into one of the fastest startups to reach a $1 billion valuation.
It took only a few years for the scooter fad to fade. Bird and its closest competitor, Lime, cut staff and dialed back operations. Uber also retreated. The coronavirus pandemic dealt a further blow when people curbed travel and fled the city centers that scooter companies occupy.
SPACs provide a path to fundraising and the public markets seen as more friendly to cash-burning companies. Last year was by far the biggest for such deals, which have slowed in 2021.
Switchback II listed in January and at first indicated it would seek to combine with an energy company. In a statement, Bird highlighted its green-energy focus and said it would introduce additional vehicle options, such as bikes, in a bid to reduce use of gasoline cars.
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