Bixi Bankruptcy Wont Affect Hubway

I talked about this before, but its good to see that they don’t expect it to affect Hubway.

A Montreal-based equipment and technology supplier for Alta Bicycle Share, the company that manages Boston’s Hubway program, has filed for bankruptcy protection, but Hubway administrators say the bankruptcy will not have an effect on Boston’s bike-sharing program.

Bixi, also known as the Public Bike System Co., announced Monday that it has filed for bankruptcy protection to “allow the company to restructure its business and finances,” according to a company statement.

The company operates Montreal’s bike-share program and provides equipment and software for Alta, the company that manages Hubway and popular bike-sharing programs in New York City; Washington, D.C.; and Chicago. The comany was racked with financial challenges for years and saddled with almost $50 million in debt. Its announcement came as little surprise to Montreal officials, who had long expressed concerns about the company’s future.

Benjy Kantor, a spokesman for Hubway, said the challenges facing Bixi are not expected to have an impact on Hubway’s operations.

“We’re expecting that Hubway will continue to run without interruption, and plans are to expand the current operations once the full system launches in spring,” Kantor said. Since Hubway’s launch in summer 2011, the network of Hubway stations has grown dramatically, extending into Cambridge, Somerville, and Brookline. The bike-sharing network also continues to grow denser. Two stations are scheduled to open in the Seaport District in the spring. (via)

More information about the new stations in the “innovation” district below (from a press release):

Jamestown Announces Hubway Outside Innovation & Design Building

$150,000 Installment to be Active this Spring

Jamestown Properties, a leading national real estate and investment firm,
announced today the installment plans for 2 Hubway Stations outside of the
Innovation and Design Building (IDB) that will be operational this spring.
This installment is just the beginning of an array of improvements planned
for IDB and the surrounding district.

Hubway, the bike sharing company, has taken the city by storm. Over 100
stations and 1,000 bikes can be found in various districts. Hubway provides
and promotes a healthy alternative to driving and erroneous city parking.
More than a mode of transportation, the bikes are utilized in the good
weather on scenic routes along the Charles, the Waterfront, and through the
Common. Jamestown has invested in a $100,000 sponsorship for the 2 stations,
and an additional $50,000 for the concrete pads, restriping, and access
ramps that will support them.

This momentum coincides with the City’s long-term vision for the
Innovation district, which is to create economic activity and jobs that will
enhance Boston’s economy and provide employment for residents. Hubway and
similar innovative companies exemplify the districts drive to create and
enhance connections within the community around them.

Jamestown is the owner of the Innovation & Design Building.

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Bixi Files For Bankruptcy

Bixi the company that runs the bike share in Montreal filed for bankruptcy.  They have ties to the Alta “family” of bike share companies the company that runs Hubway.  It looks like the system will continue in Montreal, but that it will be a public utility, rather than a private company.

Bixi was not supposed to cost them a cent but Montreal taxpayers could be on the hook for tens of millions of dollars, the city admitted Monday.

The bike-sharing service’s debt is almost $50 million.

Citing Bixi’s “grim financial portrait,” Mayor Denis Coderre announced he had forced the city-controlled non-profit company to enter bankruptcy protection.

Though he wants Bixi out of the international bike-sharing business, Coderre said he would like to see Bixi continue to roll in Montreal.

“We will have Bixi in Montreal this summer,” he said, noting many users have purchased memberships. Keeping Bixi operating in the city in 2014 could cost taxpayers a further $1.5 million.

Coderre was less definitive about whether Montrealers will have access to bike-sharing beyond 2014.

Bixi is unable to neither “meet its financial obligations nor find a viable short-term solution,” Coderre said. That was causing “uncertainty regarding the possible recovery of the sums injected by the city.”

Bixi owes the city $31.6 million on a $37-million city loan. Montreal also guaranteed a line of credit on which Bixi owes $6.4 million.

That means Montreal taxpayers could be stuck with a $38-million bill, though the city hopes a sale of the international part of the business will cut that amount.

Bixi also owes its suppliers $9 million.

In total, then, Bixi’s total debt is at least $47 million.

Bixi is also embroiled in multimillion-dollar lawsuits with a former software supplier. (via)

It would seem that the American side of the company is unaffected, and that it might even be sold off to balance some of the debts, but we will have to wait and see if there is any fall out from this news here in Boston.  Judging from the article above, it looks like their big mistake was expanding into the American market.

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