Dive Brief:
- Parking technology company Metropolis is buying parking facility management firm SP Plus for $1.5 billion as it seeks to expand its footprint across North America, it announced Thursday.
- Metropolis has obtained commitments for $1.7 billion in financing for the deal: $1.05 billion in Series C funding and $650 million in debt financing.
- Metropolis said it plans to bring its checkout-free payment process to SP Plus’ network of more than 360 sites in the U.S. and Canada that process over $4 billion in annual payments.
Dive Insight:
A report by security camera firm Eagle Eye Networks found that 67% of cloud video surveillance cameras with license plate recognition are used for parking applications.
Metropolis’ system uses computer vision to allow customers to drive in and drive out without pulling out a credit card or cash at the gate. Instead, parking customers provide their name, license plate number, phone number and payment method via an app.
SP Plus manages approximately 2 million parking spaces and provides services at over 3,300 commercial locations and 160 airports, the release said. With the acquisition, Metropolis aims to scale its checkout-free payment experience to SP Plus’ aviation, commercial, hospitality and institutional clients across North America, it said.
“While transforming the parking experience is our focus and priority today, as we deploy our proven technology we see opportunity to offer checkout-free transaction experiences at even more places people go,” Metropolis CEO and co-founder Alex Israel said in the release
Metropolis will pay $54 per share in cash for SP Plus, which represents a 52% premium to the company’s closing stock price on Oct. 4 and a 28% premium over its 52-week high and aggregate enterprise value of approximately $1.5 billion, the release stated. Financing for the deal included commitments from existing investors Eldridge and 3L Capital and new investors including BDT & MSD Partners’ affiliated credit funds, Vista Credit Partners and Temasek.
The deal is expected to close in 2024 subject to regulatory approval and the approval of SP Plus’ stockholders. Once the transaction is complete, SP Plus will no longer be a public company.
