WeWork to come to the stock market late after the Spac merger – .

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WeWork to come to the stock market late after the Spac merger – .


WeWork will finally make its public debut after the approval of a $ 9 billion merger by shareholders of a blank check company, ending the real estate group’s tumultuous two-year journey to go public.

Shareholders of BowX Acquisition, a listed ad hoc acquisition company, or Spac, voted on Tuesday in favor of its transaction with WeWork, allowing the provider of shared office space to be listed on the New York Stock Exchange * at from Thursday under the WE ticker.

WeWork becomes a public company with a much more humble profile than when it first attempted in 2019, and its $ 9 billion valuation is a fraction of the $ 47 billion that SoftBank valued the company in over months of investment. before its failed IPO. BowX shares fell 7% on Tuesday.

The company has sought to reassure investors and the public that it has moderated some of the excesses that came under scrutiny in the previous listing attempt. Adam Neumann, founder and CEO of the coworking group, was ousted in 2019 and replaced by real estate veteran Sandeep Mathrani.

Along with Neumann, some of WeWork’s most ambitious and eye-catching projects and statements, including a mission to “raise world awareness” and a school designed by Neumann’s wife, Rebekah.

Since then, the company has reduced costs, reduced the number of offices and focused on its core business.

Nonetheless, WeWork is still losing billions of dollars. The company revealed to investors that it lost $ 3.2 billion in 2020, despite reducing capital spending to $ 49 million after spending $ 2.2 billion in 2019.

In May, the Financial Times reported that WeWork’s losses were escalating even as it prepared to merge with BowX. WeWork lost $ 2.1 billion in the first quarter of the year, which included a $ 500 million non-cash settlement with Neumann.

WeWork will have $ 1.3 billion from its deal with BowX, a Spac run by Vivek Ranadivé, founder of California-based software group Tibco.

This includes money held in BowX’s IPO Spac trust as well as a $ 150 million investment from Cushman & Wakefield that serves as a safety net for shareholder buybacks. Investors such as Starwood Capital Group, Insight Partners and BlackRock have further committed $ 800 million through private investment in public stocks.

SoftBank, which helped WeWork avoid bankruptcy with multibillion-dollar bailout funding, provided WeWork with a senior secured note of $ 550 million.

During a presentation to investors earlier this month, WeWork said workers in the post-pandemic world will be looking for more flexible workspaces, which would put it in a privileged position to benefit from it.

But the company’s revenue is now lower than its projection of $ 3.2 billion for 2021. In an updated presentation, WeWork said revenue totaled just under $ 1.2 billion. in the first half and are expected to be $ 1.5 billion in the second half.

WeWork’s actual revenue for the third quarter was around $ 658 million, meaning it needs to generate just over $ 806 million from October through December in order to meet its revised second-quarter projection. semester.

*An earlier version of this article incorrectly stated that WeWork would be listed on the Nasdaq Stock Exchange

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