Worldwide: Hospitality brand Selina has secured an investment of up to $50 million from Global University Systems (GUS) as the company plans to cut 350 full-time jobs by October.
The investment by GUS will be completed in several stages, starting with $10 million.
It comes as Selina posted a net loss of $30.3 million in Q1 2023 – an improvement from $38.3 million last year. Occupancy rose to 57 per cent compared to 45 per cent in the corresponding period last year.
To improve profitability, a labour restructuring plan will impact over 350 full-time employees. The decision is expected to save in annual payroll savings of $5.8 million, alongside $1 million in severance payments.
Multiple properties have also been closed, located in Mexico, the USA, Greece, Austria and Costa Rica. Additional underperforming properties are expected to follow.
Rafael Museri, co-founder & CEO of Selina said: “Securing this strategic investment from GUS marks a significant milestone for Selina. This transaction, a result of an exhaustive review of various alternatives, not only fortifies our financial standing as we work towards cash flow positivity and profitability, but also endorses our strategic goals and potential to create value for our shareholders.
“As we progress through 2023, Selina continues to focus on three strategic imperatives: enhancing cash flow, making progress on our path to profitability, and building our brand. Our approach includes a focused effort to reduce costs at both the corporate and unit levels, bolster operational efficiency, and accelerate achieving our financial goals.
“We are taking bold and decisive steps to position Selina for long-term success. Our commitment to our unique hospitality model remains strong. We acknowledge the challenges ahead and are committed to addressing them directly. We look forward to sharing more updates as we make progress on our transformation journey.”
Aaron Etingen, CEO of Global University Systems added: “As a global leader in higher education, GUS is proud to collaborate with Selina. This new relationship serves as a hedge against the shifting educational landscape in face of the growing trend of digital nomads in the world of work and education. We are excited to utilise our expertise to guide Selina’s venture into the fast-growing education and student infrastructure sector, creating a unique ecosystem for modern learners.”