Bird files for bankruptcy after going public in 2021

After laying off nearly a quarter of its staff last year, e-scooter rental company Bird has filed for Chapter 11 bankruptcy, the company announced. Existing lenders have agreed to purchase the assets and the company is being kept afloat via a $25 million loan from Apollo Global Management (Yahoo and Engadget's owner) and second-lien lenders, according to The Wall Street Journal. 

The company will continue to operate as normal and "has sufficient liquidity to meet financial obligations to city partners, vendors, suppliers, and employees during and after the restructuring process, and will operate as usual," the company wrote. The filing doesn't affect Bird Canada or Bird Europe, which are separate organizations.

Bird aims to sell off its assets for the highest possible price via a “stalking horse” agreement that will set in motion an auction of sorts. Its current lenders will designate a baseline bid before opening the proceedings to other bidders over the next few months.

Bird went public in 2021 via a "SPAC" (special purpose acquisition company) with an implied valuation of $2.3 billion, but its stock cratered less than a year later. Founder Travis VanderZanden stepped away late in 2022, at which point his stake in the company was worth less than his Miami house, according to a Crunchbase report. Bird was forced to delist from the New York Stock Exchange this year due to a valuation that was too low. 

Bird launched in multiple cities in 2017-18 with a fair amount of hype as e-scooters were seen as a sustainable urban mobility solution. It continued to grow despite a lack of profitability (following the Uber model), but the COVID pandemic forced the company to halt operations in multiple locations around the world. Since then, cities have also become more hostile to e-scooter rentals, with some seeing them now as a potential safety hazard and eyesore. 

This article originally appeared on Engadget at https://ift.tt/j43k26R

from Engadget is a web magazine with obsessive daily coverage of everything new in gadgets and consumer electronics https://ift.tt/j43k26R