Sonder Holdings Inc. and Gores Metropoulos II Inc. (GM II), a special purpose acquisition company sponsored by an affiliate of The Gores Group LLC, a global investment firm founded in 1987 by Alec Gores, and by an affiliate of Dean Metropoulos of Metropoulos & Co., have entered into a definitive agreement to merge. Sonder, a technology-driven hospitality business, is expected to have a pro forma enterprise value of $2.2 billion and more than $700 million of net cash at closing.
Sonder officially launched in 2014 and was cofounded by Francis Davidson, CEO, and Martin Picard, global head of real estate. Since its founding, Sonder has executed against its mission to transform the hospitality industry through modern, technology-powered service and inspiring, thoughtfully designed accommodations combined into one seamlessly managed experience, according to the company. Sonder currently operates more than 300 properties across 35 markets in eight countries.
Sonder works directly with real estate developers and property owners to lease, manage and operate spaces, providing guests with exceptionally designed accommodations at affordable prices on a nightly, weekly or monthly basis. Led by a management team with deep technology, operational and hospitality experience, the company’s tech-enabled, mobile-first platform provides seamless booking, digital concierge and a unified, on-demand platform for maintenance and service. Driven by its differentiated digital service model, Sonder can reduce operating costs by as much as 50% compared to traditional hotels.
“Through innovative technology and thoughtfully designed accommodations, Sonder is revolutionizing the hospitality industry,” said Davidson. “With modernized service, we are delivering uncompromising quality with inspiring design and offering accommodations at a price point that democratizes access to an extraordinary hospitality experience. We are incredibly excited about this transaction with Gores, which we view as a natural extension of our longstanding relationship that will enable us to accelerate our growth on the path to build the iconic 21st-century brand in hospitality.”
“Sonder’s differentiated, tech-driven platform and unique value proposition have put the company at the forefront of the hospitality industry,” said Gores, chairman/CEO, The Gores Group and CEO, GM II. “With its enormous market opportunity and experienced leadership team, Sonder has already proven the resiliency and scalability of its business and has tremendous potential to continue expanding globally amid tailwinds created by the impending travel recovery. This transaction strikes at the core of our continued focus on identifying and partnering with companies that are true disruptors in their industries, and we’re confident that our partnership will enable Sonder to solidify its leading position as the hospitality brand of tomorrow.”
“Throughout the course of my career I’ve been focused on finding and developing unique consumer brands and experiences,” said Metropoulos, chairman, Gores Metropoulos II. “Sonder’s fresh approach to hospitality meets the needs of an evolving traveler and puts the company in a great position to take advantage of these rapidly transforming trends.”
The business combination will provide Sonder with additional capital and expertise to accelerate and supercharge Sonder’s vision. Together with GM II, Sonder will be able to further capitalize on opportunities within the growing global lodging market and strengthen its position as a differentiated, rapidly growing innovator in the hospitality industry. Over the next few years, Sonder plans to continue investing in technology and expanding its footprint and product offering.
Sonder expects to achieve approximately $4 billion of revenue in 2025, driven by significant real estate supply growth, global travel market recovery and revenue enhancement initiatives
Goldman Sachs & Co. LLC is serving as exclusive financial advisor to Sonder. Wilson Sonsini Goodrich & Rosati is serving as legal advisor to Sonder.
Morgan Stanley & Co. LLC is serving as lead financial advisor and Deutsche Bank Securities Inc. and Citigroup are serving as capital markets advisors to GM II. Moelis & Company LLC acted as additional financial advisor to GM II. Weil, Gotshal & Manges LLP is serving as legal advisor to GM II.