Shared micromobility operator Bird announced that it has received a commitment from Apollo Investment Corporation to increase its existing $40 million vehicle financing loan facility to $150 million. Upsize goes into effect after the SPAC deal with Switchback II Corporation officially closes.
A shareholder vote to approve and confirm the business combination is scheduled for November 2. The announcement, weeks before Bird became a publicly listed company, could potentially be a move by the company to instil investor confidence before the bell rings.
Bird’s chief financial officer, Yibo Ling, says the increase in Bird’s credit facility from Apollo is a result of the “strong cash-generating potential” of its fleet of electric scooters and bikes. (Disclaimer: Apollo acquired Verizon Media Group, which owns Nerdshala. The company is now called Yahoo Inc.)
“With the increased liquidity provided by the upsized facility, we are confident that we are well positioned to support our expansion plans,” Ling said in a statement.
The news comes just a day after Bird announced that it would build “tens or hundreds of thousands” of vehicles next year equipped with its new location-based pavement riding detection technology, the type of scale that would require large upfront capital investments. Will be. Bird says that Apollo will fund the vast majority of vehicle purchases, allowing Bird to initially pay a small upfront amount to the financing solutions company, with the total amount planned to be paid in about nine months because It generates revenue.
Sources familiar with the terms of the credit facility say that vehicle financing, nevertheless, already helps Bird to be more capital efficient, giving it access to deep pockets in the winter, when Bird usually buys vehicles, And spring is the time to generate revenue. summer months. The repayment terms of the credit facility are still the same as when Apollo initially committed $40 million per bird’s SEC filing – Because Apollo’s collateral is cash from the vehicle itself and the vehicles, Bird can pay off its debt only from the revenue earned by the vehicles.
While the upsize is new, it’s not surprising. Bird already stated an objective to expand its vehicle financing capabilities to fund the majority of vehicle CapEx in 2022 and beyond, when it presented it. investor deck Back in May, so Apollo’s growth appears to be in line with those goals.