Blade Urban Air Mobility To Go Public Through Merger With Experience Investment Corp.
7:11 am ET December 15, 2020 (Benzinga) Print
Blade is a global urban air mobility platform, utilizing a technology-powered, asset light model with unrivaled brand recognition
Blade to become publicly listed on NASDAQ through a business combination with Experience Investment Corp. (NASDAQ: EXPC), a public entity sponsored by an affiliate of KSL Capital Partners, following expected transaction close in the first half of 2021
Transaction values Blade at an estimated pro forma equity value of $825 million upon consummation
Transaction to provide $400 million in gross proceeds, comprised of Experience Investment Corp.'s cash held in trust and an upsized and oversubscribed $125 million fully committed PIPE at $10.00 per share, including investment commitments from affiliates of KSL Capital Partners, Hedosophia, HG Vora Capital Management, and David Geffen, as well as original investors Barry Diller, David Zaslav and Robert W. Pittman
The capital raised will enable the Company to expand new urban air mobility routes, its network of captive passenger infrastructure, as well as its consumer-to-cockpit technology stack, accelerating its transition from use of conventional aircraft to Electric Vertical Take-Off and Landing ("eVTOL") aircraft
Blade Urban Air Mobility, Inc. ("Blade" or the "Company"), a technology-powered air mobility company, announced today that it will become publicly listed in order to bolster Blade's growth trajectory within the rapidly growing urban air mobility market and to accelerate its transition from conventional aircraft to eVTOL. Currently, more people fly helicopters in and out of U.S. city centers via Blade than any other company in the world. Urban air mobility is expected to be a $125 billion market by 2025 and grow to $650 billion over the next decade, according to Morgan Stanley Equity Research.
The Company and Experience Investment Corp. (NASDAQ:EXPC), a NASDAQ listed special purpose acquisition company sponsored by an affiliate of KSL Capital Partners, signed a definitive business combination agreement pursuant to which Blade will merge into a subsidiary of Experience Investment Corp. (which will change its name to Blade Urban Air Mobility). Upon closing of the transaction, the combined operating company is expected to continue to be listed on NASDAQ.
Blade provides consumers with a cost effective and time efficient alternative to ground transportation for congested routes, predominantly within the Northeast United States and India.
The Company has developed exclusive passenger terminal infrastructure in key markets, providing a competitive advantage in locations that are geographically constrained from adding additional heliports. Additionally, leading brands partner with Blade to provide visibility of their products and services to the Company's passengers, underscoring the brand recognition and reputation that Blade has developed.
Blade was specifically designed to be scalable and profitable using conventional helicopters today, while poised to seamlessly transition to eVTOL as soon as those aircraft are ready for public use, passing on lower operating costs to fliers and enabling a reduced noise footprint and zero carbon emissions for the communities the Company serves.
Blade operates in four key lines of business:
Short Distance – Flights between 60 and 100 miles in distance, primarily servicing commuters for prices between $595 and $795 per seat (or $295 for monthly commuter pass holders).
BLADE Airport – Flights between all New York area airports and dedicated Blade lounges in Manhattan's heliports. Prices start at $195 per seat (or $95 per seat with the purchase of an annual Airport Pass)1.
BLADE MediMobility – Blade is the largest transporter of human organs in the Northeast United States, reducing the costs and transport time for hospitals versus legacy competitors. This business is a critical part of the Company's growth strategy as organ movements are expected to be one of the first uses of eVTOL, before flights for passengers.
International Joint Ventures – As part of its expansion strategy, the Company forms joint ventures with local partners in key overseas markets to provide the technology, customer experience, infrastructure design, and employee training, that enables a scalable and consistent Blade experience. Blade's first international joint venture launched helicopter services late last year in India flying between Mumbai, Pune, and Shirdi.
The Company expects to use proceeds from the transaction to fund expansion into new markets, including the Northeast Corridor and West Coast in the United States, as well as internationally in Asia. The Company will also pursue infrastructure acquisitions in these markets, resulting in improved unit economics for its current business while enabling the Company's transition to eVTOL aircraft.
All leading aerospace OEMs, including Airbus, a Blade investor, have deployed billions in the development of eVTOL aircraft. This new aerospace technology offers significant advantages to conventional aircraft currently used by Blade. The Company's management believes eVTOL's combination of reduced noise, zero carbon footprint and enhanced safety will serve as a catalyst to developing new vertiport infrastructure (landing zones with passenger terminals) in cities across the globe.
Rob Wiesenthal, Founder and Chief Executive Officer of Blade, commented, "Ground mobility has been radically transformed by software and battery technology, as evidenced by the rapid adoption of electric vehicles. The next battle is in the air. This transaction provides the capital for Blade to profitably expand its urban air mobility business using conventional rotorcraft today, while providing a seamless transition to eVTOL aircraft tomorrow."
Eric Affeldt, Chief Executive Officer and Chairman of Experience Investment Corp., added, "Our deep investing expertise in aviation led us to evaluate dozens of potential opportunities, of which none proved as compelling an investment opportunity as Blade. We believe Blade has successfully leveraged its first-mover advantage in urban air mobility with proprietary customer-to-cockpit technology, strategic and exclusive passenger terminal infrastructure as well as a loyal customer base to catalyze growth in the industry. They are well-positioned to fortify their business growth through expansion to new markets, globally, as well as through investment in infrastructure to support new routes while accommodating the future requirements of eVTOL. Additionally, KSL's portfolio company, Ross Aviation, which operates 17 FBOs in North America, including in New York, Massachusetts, and California, may provide important partnership opportunities for Blade and Ross Aviation to accommodate eVTOL routes, maintenance and charging stations in key markets."
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