Indianapolis tech startup Arrive to go public via merger
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Indianapolis-based smart-mailbox startup Arrive Technology Inc. plans to go public via a merger with Canada-based Bruush Oral Care Inc., the companies announced Friday.
The deal is expected to close in the first quarter of 2024. The combined company will operate under the Arrive name and will trade on the Nasdaq Capital Market under the ticker symbol ARRV.
Once the merger closes, the combined company will be based in Indianapolis and will be led by Arrive’s existing management team, headed by CEO Dan O’Toole. A board of directors, likely made up of five people, will include one member selected by Bruush, with Arrive making the rest of the selections.
The deal is structured as a reverse triangular merger via an all-stock transaction, but O’Toole said the merger will provide Arrive with $10 million that is currently on Bruush’s balance sheet.
“We’ve been working really hard behind the scenes to come to terms on this deal,” O’Toole said. “This gives us funding to continue the vision of what we’re doing.”
Arrive, which launched in 2019 and did business as DroneDek Corp. until a rebranding earlier this year, has developed a smart mailbox—a climate controlled, secure receptacle—for deliveries made by drones, couriers or robots. The company has 16 full-time employees and also works with a number of contractors.
Bruush, which is based in Vancouver, British Columbia, is an e-commerce company that sells electric toothbrushes. Founded in 2018, the company went public in 2022. As of October 2022, the company had 11 employees under contract, according to a Bruush public filing from March of this year.
Arrive will not add any Bruush employees through the merger, O’Toole said, but he anticipates hiring additional employees in 2024, potentially doubling the company’s current head count over the next 12 months.
The deal, O’Toole said, also carries other benefits for Arrive. Being a publicly traded company will raise Arrive’s profile among potential customers and investors, he said, and it also provides liquidity for Arrive’s existing investors. Arrive has raised about $9 million to date through three crowdfunding campaigns and a separate campaign for accredited investors.
“Taking an investment from anybody, it’s really important that there’s a light at the end of the tunnel,” O’Toole said. “If you just take money from investors and you never get them where they can get their money back or their liquidity, it’s a non-starter.”
Before the merger closes, Bruush will do a reverse stock split within the range of 6-for-1 and 200-for-1. Reverse stock splits are a way for a company to increase the value of its existing shares. A 10-for-1 split, for instance, would turn 10 shares priced at $1 each into one share priced at $10.
Once the merger closes, Arrive shareholders will exchange those shares for shares in the new combined company.
Shares of Bruush, which closed Thursday at 17 cents each, rose to 33.7 cents in premarket trading and were trading at 24.3 cents by midmorning.