sigo believes in e-cargo bike sharing and plans to restructure under self-administration

The nationwide E-cargo bike provider sigo has announced its intention to prepare for the future through a self-administered restructuring process. The company has filed a corresponding application, and the Darmstadt District Court approved the preliminary self-administration on June 12, 2023. The company, founded in 2017, employs nearly 40 people. Their salaries are secured for three months through insolvency payments. The start-up's business operations continue fully. Based in Darmstadt, sigo GmbH is one of the first providers of a fully automatic E-cargo bike system in Germany with its inductive charging stations. The company operates in a B2B2C business model, collaborating with the housing industry and municipalities to promote the transition to e-mobility.

For the sharing operation, the company has developed its own cargo bikes adapted for rental. The high-quality bikes are inductively charged at a stationary charging station, making them quickly available. Rental is not tied to opening hours thanks to an app. Partners benefit from the full-service offering, as sigo not only provides the e-cargo bikes and the app, but also handles the installation of the charging stations, customer support, maintenance, and repair. The sharing model makes neighborhoods more attractive, and the cargo bikes contribute to traffic calming in cities and climate protection.

Challenging Environment: High Construction Interest Rates, Fewer New Buildings

The causes of the start-up's current financial situation are challenging industry conditions, including increased construction interest rates and a significant decline in new buildings over the past twelve months, leading to lower demand. Additionally, the financing situation for start-ups has recently deteriorated significantly due to substantial interest rate hikes in the capital market. Another financing round with the shareholders was unsuccessful. Therefore, the management filed for self-administration to make the best possible use of restructuring opportunities, according to the company. The company has already had good discussions with business partners who support sigo during the self-administration. The company's business operations continue without restrictions. An agreement has already been made with an existing shareholder who secures the financing of the process and has also expressed interest in a takeover.

"Our company has been operationally successful since its market launch in 2020 and has good long-term prospects, as we work with strong and reliable partners. However, the economic environment has recently changed significantly. We have therefore decided to restructure our company within the framework of self-administration. We are confident that our company will remain in the market," explained Tobias Lochen, CEO of sigo.

Self-administration is a court-supervised restructuring process to preserve companies. Under the supervision of a custodian and supported by experienced restructuring experts, the company itself leads the process. In the coming weeks, the company will work with all responsible parties to develop a restructuring plan. The management aims to reach an agreement with creditors as part of an insolvency plan. To fully leverage all restructuring opportunities, the company will also initiate an M&A process in parallel, it further stated.