Israeli-founded hospitality company Selina heads for Wall Street debut
Travel and remote-work firm signs deal for SPAC merger at $1.2b valuation with blank-check company Boa listed on NYSE
Ricky Ben-David is The Times of Israel’s Tech Israel editor and reporter.
Hospitality company Selina, founded by Israeli entrepreneurs, is headed for a Wall Street debut after the company announced on Thursday that it was entering a SPAC (special purpose acquisition company) merger agreement with Boa Acquisition Corp, a blank-check company listed on the New York Stock Exchange.
The deal values the merged company at approximately $1.2 billion. The transaction is expected to close mid-year 2022, after which the combined company will operate as Selina Hospitality, and its ordinary shares will be listed on the New York Stock Exchange under the ticker symbol “SLNA.”
Selina was founded in 2014 by Daniel Rudasevski and Rafael Museri as a co-working and traveling hospitality service, first in Central America, where the two were traveling at the time, and then the rest of the world. Today, the company says it operates a network of 134 properties across North and South America, Europe, and the Middle East (of which 83 are open and the rest under works).
The company has been backed by investors such as US multinational industrial group Access Industries, the Dubai investment firm Abraaj Group, and fellow Israeli Adam Neumann, the co-founder and former CEO of troubled co-working space company WeWork.
Combining affordable accommodation, co-working spaces, fine dining, wellness, volunteering initiatives, and other local experiences, Selina caters to millennial and Generation Z travelers and workers, or “digital nomads.” According to the company’s estimates, these remote workers and frequent flyers spend approximately $350 billion a year on travel.
Selina says that by “leveraging proprietary technology to identify underperforming hotels,” it then works with real estate owners to “transform them into cultural hubs through partnerships with local artisans, designers, and food and beverage providers, in addition to introducing programming inspired by local experiences.” The company says these owners pay an average of 90% of the cost for the transformation into Selina-branded locations.
In an investor conference call on Thursday to announce the agreement, Museri said Selina had secured $350 million of committed capital to expand in 12 locations and add approximately 40,000 new beds by 2025. These locations include new areas in Mexico, Germany, the UK, and Australia.
Selina also operates a number of locations in Israel including Tel Aviv’s Neve Tzedek neighborhood, Mitzpe Ramon, and the Jerusalem mountains.
Museri said the company had seen rapid growth over the past two years and is on a “clear path to profitability over the next several years.”
“We are experiencing greater demand than we did prior to COVID, and our new property offerings are indicative of how well the Selina brand is resonating with our target customers,” Museri said in the company statement Thursday. “Despite the challenges the pandemic has placed on global travel, our portfolio is exceeding our long-term targets, and we are excited about the next steps in our company’s evolution as a leading lifestyle brand and hotel operator.”
The CEO said Selina “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.”
Selina operates a number of programs for its guests including Nomad Passport for those who want to purchase multiple destination stays ahead of their travel, SelinaCoLive for remote workers who want to stay at a Selina property for an extended period of time, and Remote Year, which offers packages for participants to live and work in a new city each month for the program’s duration, paid for by their employer.
Brian Friedman, CEO of Boa Acquisition, said Selina has proven “it can deliver for both its guests and its real estate partners. We anticipate Selina will continue to build on its significant growth in the coming years as the ability to work from anywhere propels travelers to experience the world in a way their elders never could – as digital nomads.”