Int'l hospitality network Selina to go public via SPAC

Selina's Manuel Antonio hotel in Costa Rica  credit: Selina
Selina's Manuel Antonio hotel in Costa Rica credit: Selina

Selina, founded by Rafael Museri and Daniel Rudasevski, has its technological development center in Tel Aviv.

International hospitality company Selina, which was founded in 2015 by Israeli entrepreneurs Rafael Museri and Daniel Rudasevski, is on its way to a Wall Street flotation at a valuation of $1.2 billion. The plan for the company to go public through a merger with BOA Acquisition Corp. by mid-2022. Among the investors in the Selina network of hostels are Ronald Cohen, More Capital, Gigi Levy, Shaul Shani and Adam Neumann. The merged company will operate under the name Selina Hospitality plc, and its ordinary shares are expected to be listed on the New York Stock Exchange under the ticker symbol SLNA.

Selina is not concerned about the SPAC listing method, which has not worked out well for many companies, arguing that many companies that were not ready to come to the public market chose that route. Its management sees Selina as a strong global brand with high revenue, and the SPAC method as a legitimate and good product for reaching the US market.

The network is active in 23 countries on four continents. It deals both in hospitality and in cultural content for its customers. Sources at the company explained that a large part of its revenue, estimated ay a t least $100 million annually, comes from the "community", and not from rooms. The company believes that becoming publicly traded will enable it to grow and expand to more destinations and to reach new target markets. It also sees itself operating in more countries in the Middle East, and in Australia and Thailand.

In each Selina hostel there is "democratization of rooms". There are both shared and private rooms at various price levels. The network employs nearly 250 people in Israel, and estimates that this number will grow to at least 400 by the end of next year. The development center is in Israel, and the company says that it will remain here. Its management offices are divided between Israel, London, and New York. Twelve new Selina hostels are expected to open in Israel in the coming year. The company recently signed an agreement with Israeli real estate company Hagag Group, making it its main partner in Israel.

Selina has secured $350 million of committed capital from partners to expand its offering in 12 geographies, which is expected to add approximately 40,000 new beds to the Selina network by 2025. In addition to its pay-as-you-go offering, Selina has introduced an innovative subscription service-Nomad Passport-that allows guests to stay at any Selina location for as long as they like, with full amenities including accommodation, co-working, wellness activities and locally curated events.

Selina stresses that its lifestyle brand was developed for millennials and Gen-Z backpackers and tourists, a group that the company estimates spends $350 billion annually on travel.

Selina has secured $350 million of committed capital from partners to expand its offering in 12 geographies, which is expected to add approximately 40,000 new beds to the Selina network by 2025. In addition to its pay-as-you-go offering, Selina has introduced an innovative subscription service-Nomad Passport-that allows guests to stay at any Selina location for as long as they’d like, with full amenities including accommodation, co-working, wellness activities and locally curated events.

Under the terms of the BOA transaction, a group of institutional investors including South Light Capital (an affiliate of DigitalBridge), More Investment House and Sir Ronald Cohen, alongside BOA’s sponsor and founder-led stockholders, have committed $70 million of capital, which includes a $15 million minimum equity backstop from BOA’s sponsor. Of the total, $10 million will be an advanced PIPE funded concurrent with the announcement, strengthening Selina’s balance sheet as it rolls out new sites. There is approximately $230 million currently held in BOA’s trust account. Subject to any redemptions by BOA stockholders, existing Selina shareholders will retain approximately 71% ownership in the combined company.

The business combination is expected to provide Selina with $285 million (assuming no redemptions) of gross transaction proceeds. The company says that it will use proceeds from the transaction to fuel its expansion across large urban markets globally, as well as invest in its proprietary technology and attract and retain high-quality talent.

Selina expects to report positive EBITDA in the first quarter of 2023, and to reach annual revenue of $1.2 billion in 2025.

Selina's operating model is based on cooperation with real estate owners, who on average pay 90% of the cost of converting their assets into Selina-branded destinations. The boards of directors for both Selina and BOA have unanimously approved the business combination. The transaction will require the approval of the stockholders of BOA and Selina and is subject to other customary closing conditions. The transaction is expected to close in the first half of 2022. PJT Partners is acting as financial and capital markets advisor to Selina, and BofA Securities Inc. is acting as capital markets advisor. Morgan, Lewis & Bockius LLP is acting as legal advisor. PJT Partners, UBS Investment Bank and BTIG LLC are acting as joint placement agents on the private placement. UBS Investment Bank is acting as the lead capital markets advisor to BOA, while BTIG LLC is acting as capital markets advisor and King & Spalding LLP is acting as legal advisor.

"Millennials and Gen-Z travelers are looking for authenticity and top-tier experiences at every step-they want to be immersed in the local culture of each location they visit," Museri said. "By partnering with local artisans to design culturally relevant and inspiring destinations, we’re creating opportunities for them to forge lifelong connections within the rapidly expanding Selina community. We’ve spent the last six years building and scaling an efficient and differentiated platform, and this transaction will enable us to bring Selina to more locations and travelers across the world."

Published by Globes, Israel business news - en.globes.co.il - on December 2, 2021.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2021.

Selina's Manuel Antonio hotel in Costa Rica  credit: Selina
Selina's Manuel Antonio hotel in Costa Rica credit: Selina
Highcon chairperson Shlomo Nimrodi  credit: PR Packaging tech co Highcon winding down

The company, which numbers Benny Landa and JVP among its investors, is laying off most of its workforce, having lost 99.9% of its value since its flotation.

MK Almog Cohen  credit: Danny Shem-Tov, Knesset Spokesperson's Office Netanyahu halts Nevatim airport bill

Legislation mandating construction of an airport at Nevatim, near Beersheva, is ready for final Knesset approval, but the prime minister blocked it after a security cabinet meeting.

Big banks CEOs credit: Oren Dai, Jonthan Bloom and Israel Hadari Israeli banks unveil NIS 3b customer benefits package

The benefits over two years meet the target set by the Bank of Israel to ease the burden for customers, while the banks are reporting record profits.

Eilat's old airport Photo: Shutterstock Building set to begin on former Eilat airport land

2,469 housing units will be built as well as 2,776 hotel rooms, 88,000 square meters of office space and 95,000 square meters of commercial space.

Liron Horshi credit: Jonathan Bloom Wiz's talent manager nurtures $1b workforce

Wiz's $32 billion sale to Google was rooted in the cloud security product if offers but could not have been achieved without the quality of its employees built by human resources chief Liron Horshi.

Gas station in Israel credit: Tali Bogdanovsky Gasoline prices in Israel to rise Monday night

The maximum price of government price controlled 95 octane gasoline at self-service pumps in Israel will rise on Monday at midnight April 1, 2025, by NIS 0.08 per liter to NIS 7.31 per liter.

Israeli apartments Credit: Shutterstock Apartments sold and rented

A selection of recent real estate deals in Israel in Givatayim, Ra'anana, Modiin-Maccabim-Reut, Gedera, Kiryat Shemona and Ashkelon.

Fencing goes up Petah Tikva's Segula neighborhood  credit: NTA The Metro is really happening

Although there are skeptics who doubt that the project will ever be realized, there are now enough signs on the ground to indicate that they are probably wrong.

Ben Gurion airport Terminal 1 credit: Shutterstock Ben Gurion airport's Terminal 1 reopens

Terminal 1 at Ben Gurion airport reopened yesterday to domestic flights, while international flights will start using the terminal from Sunday, March 30.

Minister of Interior Moshe Arbel credit: Cadya Levy Interior Minister: There is no deep state in Israel

Minister of Interior Moshe Arbel told the Globes Services conference that civil servants are dedicated employees who serve the public.

Minimum wage credit: Tali Bogdanovsky Minimum wage in Israel to rise next week

The monthly minimum wage in Israel will be revised upwards by 6%.

Bank of Israel  credit: Shutterstock/Alon Adika Bank of Israel slams gov't fiscal policy

Governor Prof. Amir Yaron wrote in the annual report that the government's measures are not enough to ensure a sustained decline in debt-to-GDP ratio.

Minister of Justice Yariv Levin credit: Noam Moskovitz Knesset Spokesperson Knesset passes Judicial Selection Law

The new law makes judicial appointments subject to political control.

Airbnb credit: Reuters Knesset ignores Airbnb tax evasion loophole

The Israel Hotels Association has slammed the government's indifference to tax evasion by Airbnb landlords, which it insists promotes unfair competition.

GMT CFO Eran Tibon credit: PR Political tensions tempt Israelis to move funds abroad

According to data from advanced financial services company Global Money Transfer, steps taken by the Israeli cabinet to oust Shin Bet chief Ronen Bar, and Attorney General Gali Baharav-Miara, could cause capital to flee Israel.

Sde Dov credit: Guy Yehieli Tenders close for 2,744 more homes in Sde Dov

Four tenders closed last month for the north Tel Aviv district saw a decrease of about 40% in the prices of land, and there is great interest in the prices these latest tenders will fetch.

Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018