The urban transport app Citymapper is to explore a sale after receiving takeover interest from some of the world’s largest technology companies.
Sky News has learnt that Citymapper has engaged advisers from Raine, the New York-based merchant bank, to steer it through discussions with suitors.
City sources said on Tuesday that Raine had been hired by the company in the past week following unsolicited expressions of interest in both licensing deals and a full takeover.
The identities of the parties which had approached Citymapper was not immediately clear, although technology industry insiders cited Apple, Microsoft and Google’s parent company, Alphabet, as logical potential suitors.
Citymapper is among the most prominent players in the UK tech sector.
It was established in 2010 by Azmat Yusuf, a former Google employee, with a pledge to address some of the challenges of urban mobility.
Its app enables travellers in London, for example, to buy an integrated pass that can be used on public transport methods including buses and trains, as well as private-hire vehicles such as cabs and cycles.
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Citymapper is now present in more than 40 cities, including Birmingham and Manchester in the UK.
In Europe, it operates in Barcelona, Copenhagen, Milan and Paris, while in the US it has a presence in Chicago, Los Angeles and New York.
The company has also launched in Hong Kong, Melbourne and Tokyo.
Sources said that a sale of the company was not certain to take place, particularly if its valuation expectations are not met, according to one source.
The price at which Citymapper’s shareholders and management would be prepared to accept a bid is unclear.
In its last external funding round, in 2016, it was reported to have been valued at more than $325m.
The company is understood to have raised money since then from existing shareholders, which include successful venture investors Balderton Capital and Index Ventures.
Losses have also mounted, however, with Citymapper’s most recent accounts at Companies House disclosing that it has accumulated losses of more than £20m.
“The company intends to raise additional funds to continue its growth and enable the company to meet its liabilities as they fall due, and given the history of past fundraising the directors are confident that this additional fund raising can be successfully achieved,” its accounts for 2018 said.
Citymapper’s appointment of bankers comes during a frenzied period of activity for urban mobility start-ups, many of which are wrestling with policy-makers over the impact of the technology platforms they have pioneered.
In London, Uber Technologies is facing the prospect of a ban for the second time in less than two years after being deemed “not fit and proper” by regulators.
A number of rivals, including Bolt, Gett and Kapten are now engaged in an aggressively priced battle to win market share in the capital.
For its part, Citymapper has described Transport for London as “the most forward-thinking public transport agency in the world”.
It has pledged the introduction of smaller buses that it says are necessary in crowded cities.
Citymapper and Raine both declined to comment.
SOURCE : https://news.sky.com/story/citymapper-plots-route-to-sale-amid-bid-interest-11919888