SWVL upsizes their pipe to $120m

New flagship investors include EBRD in connection with Queen Gambit's business combination
SWVL upsizes their pipe to $120m

Swvl, a global provider of transformative tech-enabled mass transit solutions, announced additional PIPE investments related to its proposed business combination with Queen’s Gambit Growth Capital (NASDAQ: GMBT), the first special purpose acquisition company founded and led entirely by women. This is expected to further enhance the strength of Swvl’s balance sheet and help to fuel the company’s strategic growth initiatives.

“Today’s announcement represents a clear vote of confidence in Swvl’s growth strategy and future as a public company. We continue to demonstrate significant momentum towards our strategic goals. Armed with additional funding certainty, we are confident in Swvl’s ability to bring its transformative technology and services to new markets, in turn transforming a $1 trillion global mass transit industry that is sorely in need of effective solutions. We look forward to completing the business combination, entering the public market, and continuing to create tremendous value for all stakeholders,” Mostafa Kandil, Swvl Founder and CEO, said.

Swvl has entered into agreements for an additional $21.5 million of common stock in a private placement (PIPE) with additional new flagship investors including European Bank for Reconstruction and Development (EBRD). These institutions join a distinguished group of global strategic and financial investors providing fully committed PIPE financing for the transaction, including Agility, Luxor Capital Group, Chimera and Zain.

“Swvl is a highly dynamic tech investor with a transformative business model that brings tangible benefits to travelers in Egypt and other countries of operation of the EBRD, benefiting female travelers in particular. EBRD is delighted to support SWVL at this key moment in its remarkable journey from a start-up to becoming a company listed on the NASDAQ,” Sue Barrett, Director, Sustainable Infrastructure for Middle East, Turkey and Africa, said.

The investment terms are substantially similar to those in the initial PIPE financing announced in conjunction with Swvl’s proposed business combination transaction with Queen’s Gambit on July 28, 2021. This additional investment increases the aggregate amount of expected PIPE proceeds to $121.5 million, providing additional capital to fund Swvl’s expansion efforts and further investments in its proprietary technology platform.

“Since announcing our proposed business combination with Swvl, the Swvl team has gone well beyond every element of its business plan, with strong execution across its existing markets, while pursuing additional attractive market opportunities in new geographies. The additional capital is expected to allow Swvl to continue to create significant value for all stakeholders. Swvl continues to be uniquely positioned from a technological, financial and operational basis to execute on this tremendous market opportunity,” Victoria Grace, Founder and CEO of Queen’s Gambit Growth Capital, said.

Swvl has completed pre-funding of $66.5m out of the PIPE to accelerate its growth strategy. The investors that pre-funded the PIPE have purchased exchangeable notes of Swvl. At the closing of Swvl’s business combination with Queen’s Gambit, each exchangeable note will be automatically exchanged for shares of the combined company at an exchange price of US$8.5 per share for $45.5m of notes that were issued in 2021 and $9.1 per share for $21m of notes that were issued in 2022.

“We greatly appreciate that many highly regarded global investors including EBRD have clear confidence in our growth strategy. With this additional infusion of growth capital, we expect to be even better positioned to pursue further organic and inorganic strategic initiatives after our recent acquisitions of controlling interests in Shotl and Viapool and investments in mass transit platforms in Mexico and the United Kingdom,” Youssef Salem, Swvl CFO, said.

EBRD’s commitment is subject to entering into an investment framework agreement governing certain institutional requirements of EBRD, including social and environmental policies and practices, corporate governance and compliance matters and use of proceeds.

If you see something out of place or would like to contribute to this story, check out our Ethics and Policy section.