Bird fuels rumors that a Canadian company is saving its bacon • InNewCL
#Bird #fuels #rumors #Canadian #company #saving #bacon #InNewCL Welcome to InNewCL, here is the new story we have for you today:
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The scooter company Bird is down, but not out yet.
The five-year-old company says it and Bird Canada — a separate, private company that licenses Bird’s software and name — will be merging “as soon as possible” for an “estimated total of $32 million new funding” from Bird Canada investors, “of which $4 million has already been funded.”
The merger news follows a difficult year for Bird, which recently exited dozens of markets, alerted investors that it had overstated its earnings for two years, received a warning from the stock market that it was under-trading and potentially some of these must close operations. That money could be just what Bird needs to stay in the scooter game, at least according to CEO and President Shane Torchiana.
Torchiana recently told InNewCL he believes Bird needs to raise another 3% to 4% of what the company has raised historically — or another $26 to $35 million, according to Crunchbase data — to sustain itself .
However, investors don’t seem convinced that this is the lifeline Bird needs to be ultimately profitable. Bird’s share price fell more than 7% during today’s announcement. The stock was trading at $0.16 per share when this story was published.
In May 2021, Bird was reportedly valued at $2.3 billion before completing a SPAC deal that took it public on the New York Stock Exchange. Bird’s market cap has since plummeted and is now around $48 million.
Bird Canada was founded in 2019 by Toronto Raptors founder John Bitove. Bitove also founded Obelysk, one of Bird Canada’s investors.
According to Bird’s statement, the transaction would “add additional profitable operations to Bird’s global platform while consolidating North American operations.” Should the merger be completed, Bird intends that Bird Canada CEO Stewart Lyons will become President of the combined company and FreshBooks Chief Financial Officer Michael Washinushi will succeed Bird’s current CFO, Ben Lu.
