The hosting company was founded in 2014 by Daniel Rodsevski and Rafi Mosari and has 163 hosting sites in more than 20 countries all over the world (on six different continents). The locations of the company’s hostels can also be found in jungles on the one hand and on the other hand also in urban centers and city centers, among others the company operates in Costa Rica, Melbourne, London and Israel. The company was merged into the SPAC BOA at a value of 1.2 billion dollars and was issued at a price of 9.75 dollars per share.
Are we contracting another “water share”?
The company’s stock has fallen since the issue by about 15% to a price of $8.3 per share, the stock has since reached For a price of 40 dollars per share – a jump of more than 300%. Trading in the company’s stock is conducted at low volumes and some of us are beginning to imagine an Israeli company that also experienced incomprehensible jumps in the share price – Pagaia. Less than half a year ago, the company was issued at a value of about 8 billion dollars, also through Spak, and the stock crashed that day by about 40%. Since that day the stock has experienced ups and downs and in the end we saw the value of the company exceed 20 billion dollars, apparently due to a short squeeze on the loss-making company. The company’s stock reached a price of $30 per share and today the company’s stock trades at a price lower than $1.50, about 90% of the issue price.
It is not clear if the situation of Selina shares will be the same, but it is indeed clear that the value attributed to the company is not reasonable, it is not just that the underwriters and the large entities issued at a price of $9.75 per share and the situation currently does not make sense, when The stock keeps going up. The extreme increases are mainly due to the low marketability of the company’s stock (the trading volume is about 200 thousand shares) and the company still has a long way to go to justify the current price.
the issuance
The company entered into a merger agreement with the SPAC BOA in December 2021, Ben Friedman, CFO and President of the SPAC, said: “The Selina is one of the only hospitality companies that is truly revolutionizing the travel world and addressing real market needs. We are proud to help launch this dynamic lifestyle brand, and we look forward to continuing to work together with Rafi and the rest of the Selena team as they grow their platform and execute their strategy.”
How the shares are distributed:
In SPAK-type issuances, the share price on the first trading day is $10. Selina will own 87.4 million shares of the company which will constitute 86% holding in the company, BOA’s investors will own 23 million shares. The PIPE investors (an additional fundraising made at the same time as the merger from private or institutional investors) will hold 7.07 million shares, and the sponsor who is responsible for mediating the transaction and merger on behalf of BOA will hold 5.7 million shares. A total of 123.2 million shares were issued at a multiple of the share price, the value obtained is about 1.2 billion dollars.
Rafi (Raphael) Mosari, co-founder and CEO of the company, said: “Today marks an important achievement for Selina, as we complete our goal of becoming a public company and begin our next phase of growth. The completion of this IPO is another confirmation of the unique hospitality we provide, we can increase the brand and our unique destinations for travelers and locals around the world like never before.” in the company’s board of directors.
As mentioned, the company operates all over the world and indeed sets a new standard when it comes to travel and hospitality. The company allows its guests to stay in its inns for long periods of time while making sure to establish comfortable work spaces for all who desire it, thus allowing a very interesting option for digital nomads who want to wander between one exotic location and another. The company allows its guests to pay a certain amount of money, which gives customers the option to spend the night in a large number of different inns without limit, which is very convenient for many travelers (especially young ones) who want to make a trip around a certain continent (Central or South America for example) and want to do it “in mind” Quiet”, when they know what they are going to get wherever they go.
The company is not profitable yet and the road to get there is still long – in 2021 the company recorded a loss of 185 million dollars and a negative cash flow of more than 10 million dollars. Despite the dismal data, it is quite clear that the goal is growth and the company shows this both in actions and words. The company registered a jump in its income in 2021 to 86 million dollars and despite the corona, the company opened 13 more sites around the world that year.
What will be the duration?
A big and very important question regarding the future of the company is, of course, the effect of the current situation in the world on tourism and the income and growth of the company – a growing recession in Europe, rampant inflation around the world and aggressive interest rate increases by the US, may significantly affect the desire and ability of many people to travel around The world and the matter can hurt the company very much. The company has very high operating costs, especially when it owns such a large amount of websites, and without people to fill the inns, the company basically depends on the gray cloud that is over the world’s economies disappearing as quickly as possible, apparently without having Many ways to maintain income.
It is important to remember that the first test Selina will face is not the first days of trading on Wall Street, the first test will be to win the trust of the investors of the SPAC company it is merging with – BOA, who will keep their money and believe in the target company, Selina, but even if this does not happen, to Selina There will be more independence to sail the ship as it pleases, only with the eyes of the US Securities and Exchange Commission.
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