Bird’s flying low
Chapter 11 is effectively a self-administered insolvency proceeding usually filed to allow a company to reorganise and protect it from legal actions by debtors until the reorganisation is complete. In the wake of the 2009 financial crisis, General Motors filed for Chapter 11 bankruptcy proceedings. Proterra has also undergone the process and found buyers of parts of its businesses in Volvo Group and Phoenix Motorcars recently.
But back to Bird. The mobility company aims to sell its assets within 90 to 120 days but says it will maintain operations during this process.
The subsidiaries Bird Canada and Bird Europe are not affected by the proceedings.
The company’s first- and second-lien lenders have also entered into a restructuring support agreement (RSA), which could help Bird access $25 million in new debtor-in-possession financing.
The company was an early bird in the rental scooter market when ex-Uber executive Travis van der Zanden founded the global business in 2017. According to Bloomberg, he turned Bird into one of the fastest startups to reach a one-billion-dollar valuation, but in 2022, it started flying considerably lower. At the time, Bird withdrew from Germany and other markets and was also affected by bans or restrictions on e-scooters increasingly imposed by cities.
Still, Bird believes that the Chapter 11 filing is just part of a transition. “This announcement represents a significant milestone in Bird’s transformation, which began with the appointment of new leadership early this year,” said Bird Interim CEO Michael Washinushi. “We are making progress toward 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 livable by using micromobility to reduce car usage, traffic, and carbon emissions.”
The company claims that Bird riders have travelled over 300 million miles globally since its inception, offsetting an estimated 90 million pounds of carbon emissions from avoided car trips.
0 Comments