Metropolis, the AI-driven parking platform, has made headlines by securing a whopping $1.7 billion in funding to acquire SP Plus, a leading provider of parking facility management services. This acquisition, a blend of equity and debt, is set to redefine the parking industry.
The Funding Breakdown
Metropolis’ recent funding round was co-led by Eldridge Capital and 3L Capital, with significant contributions from BDT & MSD Partners’ affiliated credit funds, Vista Credit Partners, Temasek, Slow Ventures, and Assembly Ventures. The financing details reveal that Metropolis will assume $650 million in loans and $1.05 billion in Series C preferred stock financing.
The acquisition of SP Plus will cost Metropolis approximately $1.5 billion, allowing the company to retain a significant amount of capital. Alex Israel, the Co-Founder and CEO of Metropolis, expressed his enthusiasm about the acquisition, highlighting SP Plus’s operational excellence and its strong reputation among real estate owners across North America. The merger aims to introduce checkout-free payment experiences for consumers, enhancing the overall parking experience.
Founded in 2017 by serial entrepreneur Alex Israel, who previously sold his company ParkMe to Intrix, Metropolis has been on a mission to revolutionize the parking industry. The company’s unique approach involves equipping existing parking structures with a computer vision system. This technology allows customers to enter and exit parking facilities without the need for physical payment methods. Instead, the system automatically charges the vehicle owners and sends them an email receipt upon exit.
SP Plus: A Valuable Addition
With the acquisition of SP Plus, Metropolis is set to expand its footprint significantly. SP Plus, a publicly traded company, boasts over two million parking spaces and manages more than 3,300 parking facility locations. Their operations also extend to parking and shuttle bus services at 160 airports across the U.S. and Canada.
While Metropolis is currently focused on transforming the parking experience, the company sees potential in expanding its technology to other sectors. Alex Israel envisions the application of their computer vision platform in gas and electric vehicle charging stations, drive-thrus, car washes, and even retail stores. This expansion would offer consumers a seamless transaction experience, similar to online shopping.
The acquisition of SP Plus by Metropolis, priced at $54 per share in cash, represents a 52% premium over SP Plus’s stock price as of October 4. Both companies’ boards of directors have unanimously approved the transaction, which is expected to conclude in 2024. The future collaboration between the two companies and the potential integration of their workforces remains a topic of interest in the industry.
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