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Electric Scooter giant Bird Has filed for Bankruptcy

Bird, a trailblazer in the electric scooter industry, has officially filed for Chapter 11 bankruptcy, marking the culmination of a tumultuous year for the company. The move comes after a series of setbacks, including a declining stock price, leadership changes, and delisting from the New York Stock Exchange (NYSE).

In a press release, Bird stated that the bankruptcy filing is part of a “financial restructuring process aimed at strengthening its balance sheet,” emphasizing its commitment to continue day-to-day operations in pursuit of long-term, sustainable growth.

Founded in 2017 by former Lyft and Uber executive Travis VanderZanden, Bird introduced dockless micromobility platforms worldwide, allowing urban dwellers to access electric scooters or bikes for short-term use. Despite going public in late 2021 through a SPAC merger, Bird’s stock faced significant challenges in a competitive market, leading to a drastic drop in market capitalization from over $2 billion to just $70 million within a year.

The decline prompted the NYSE to issue a warning about Bird’s low share price. CEO Travis VanderZanden left the company in June, and Bird was eventually delisted from the NYSE in September.

To navigate the financial restructuring, Bird opted for a Chapter 11 bankruptcy, enabling the company to reorganize its financials without disrupting daily operations. Existing lenders, including Apollo Global Management division MidCap Financial, will provide $25 million in financing during the bankruptcy proceedings.

The primary objective of the bankruptcy is to facilitate the sale of Bird’s assets. The process will involve a “stalking horse” agreement to establish a baseline bid by existing lenders before opening the bidding to external parties over the next four months.

Michael Washinushi, interim CEO of Bird, will continue in his role throughout and after the restructuring. Washinushi highlighted the bankruptcy as a “significant milestone” in Bird’s transformation, expressing a focus on achieving profitability and advancing the mission to make cities more livable by reducing car usage, traffic, and carbon emissions through micromobility.

It’s noteworthy that Bird’s Canadian and European operations are excluded from the bankruptcy filing and will continue normal operations.

This development follows similar challenges in the micromobility industry, with competitor Micromobility.com recently being delisted from the Nasdaq due to declining stock prices, and European dockless scooter startup Tier announcing layoffs. The industry faces headwinds, but Bird remains optimistic about its mission despite the hurdles encountered in the past year.

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