SP Plus Acquisition: Key Details, Impact, and What Comes Next

Metropolis Technologies' acquisition of SP Plus Corporation marks a significant milestone in the parking and mobility services industry. The $1.8 billion deal, completed on May 16, 2024, positions Metropolis as the largest parking network operator in North America. This strategic move aims to leverage AI technology to enhance consumer experiences and operational efficiencies across over 4,000 locations.

What Is SP Plus?

Founded in 1929, SP Plus Corporation offers a wide range of services including consulting, event logistics, facility maintenance, guest services, luggage logistics, marketing services, parking management, remote management, and transportation management. The company differentiates itself through the integration of cutting-edge technology, a holistic approach to transportation, and remote management solutions. SP Plus also emphasizes event-specific customization, diverse industry expertise, and a commitment to diversity, equity, and inclusion, making it a leader in mobility solutions.

Who Acquired SP Plus?

Metropolis Technologies, Inc. is a leading technology provider and parking operator that leverages artificial intelligence, specifically computer vision, to enable seamless, "checkout-free" payment systems for drivers. Their key services include a checkout-free payment system, tech-enabled parking operations management, and advanced technology solutions to enhance asset productivity. With over 11 million drivers and operations in 360+ markets, Metropolis holds a significant market presence and influence in the parking and real estate management industry.

When Was SP Plus Acquired?

Metropolis Technologies completed the acquisition of SP Plus Corporation on May 16, 2024. This acquisition aligns with industry trends emphasizing AI and technology integration in mobility services. The deal, valued at $1.8 billion, positions Metropolis as the largest parking network operator in North America. The timing reflects a broader movement towards leveraging advanced technologies to enhance operational efficiencies and consumer experiences in the parking and real estate sectors.

Why Was SP Plus Acquired?

• Market Expansion: The acquisition solidifies Metropolis as the largest parking network and operator in North America with more than 4,000 locations and over 20,000 employees. This move allows Metropolis to expand its reach to more than 50 million consumers, processing over $4 billion in payments annually.
• Technology Integration: Metropolis will deploy its AI technology to more than 50 million consumers, enabling checkout-free payment experiences. The integration of SP Plus's industry-leading technology with Metropolis's computer vision platform aims to enhance the speed, ease, and convenience of transactions, transforming the parking experience.
• Competitive Advantage: The acquisition and integration of SP Plus's extensive network and services with Metropolis's advanced AI technology create a unique value proposition. This combination positions the company to offer unparalleled convenience in the parking industry, setting a new standard and driving significant value to real estate partners and consumers alike.

Acquisition Terms

• Acquisition Price: $54.00 per share in cash, with an enterprise value of approximately $1.5 billion.
• Payment Method: The transaction was financed with $1.05 billion in Series C preferred stock financing, $550 million of term debt financing, and a $175 million revolving debt facility from PNC Bank, National Association.
• Key Conditions or Agreements:
  • SP Plus Corporation stockholders will receive $54.00 per share in cash.
  • The acquisition represents a premium of approximately 52% to the closing stock price on October 4, 2023, and approximately 28% premium to the 52-week high as of October 4, 2023.
  • The transaction is subject to receipt of required regulatory approvals and approval of SP Plus's stockholders.
  • SP Plus shares will no longer trade on the Nasdaq Global Select Market following the completion of the transaction.
  • The boards of directors of both companies have unanimously approved the transaction.
  • The transaction is expected to close in 2024.
  • Metropolis will continue to be founder-led and founder-controlled as a private company.
  • The acquisition solidifies Metropolis as the largest parking network and operator in North America with more than 4,000 locations and over 20,000 employees.

Impact on SP Plus

The acquisition of SP Plus by Metropolis Technologies has led to significant changes in operations and management. SP Plus is now a part of Metropolis, making it a founder-led and founder-controlled private company. The nearly 20,000-person team of SP Plus has been integrated into Metropolis, and SP Plus shares no longer trade on the Nasdaq Global Select Market. This consolidation aims to streamline operations and leverage Metropolis's AI technology to enhance service delivery and operational efficiency across the combined entity's extensive network.

In terms of product offerings and services, the merger is set to revolutionize the parking experience through the deployment of AI technology. Metropolis plans to integrate its checkout-free payment systems into SP Plus's managed facilities, enhancing the speed, ease, and convenience of transactions for over 50 million consumers. While specific employee and customer reactions are not detailed, the strategic focus on improving daily lives and driving value to real estate partners suggests a positive outlook. For founders considering business transitions, tools like Sunset can assist in managing such processes compliantly and efficiently.