WeWork is to go public in a merger with a special-purpose acquisition company, according to reports, nearly two years after its attempted initial public offering of shares disintegrated.
The flexible workspace firm is merging with BowX Acquisition in a transaction that would value the company at 9 billion dollars (£6.5 billion) plus debt, according to the Wall Street Journal.
That is far below the 47 billion dollar (£34 billion) valuation given the New York venture in September 2019 when WeWork’s IPO imploded after massive losses were revealed in regulatory filings.
WeWork would also raise 1.3 billion dollars (£940 million), the Journal reported, citing people familiar with the matter.
WeWork leases buildings and divides them into office spaces to sublet to members, which include small businesses, start-ups and freelancers who want to avoid laying out funds for permanent office space.
The company’s operating expenses were exorbitant and it became reliant on repeated cash infusions from private investors.
Chief executive and founder Adam Neumann, known for erratic behaviour as much as for his innovative vision, was pushed aside. He used some of his WeWork stock to secure a 500 million dollar (£363 million) personal loan prior to the IPO.
He also drew criticism after The We Company — WeWork’s recently renamed parent — paid him nearly 6 million dollars (£4.3 million) for the trademark “We”. He returned the money following a backlash.
Mr Neumann co-founded WeWork in 2010 with one shared office in Manhattan.
