WeWork to go public via $9 billion SPAC deal

A Wall Street Journal report has it that WeWork has agreed to go public through a merger with blank-check firm BowX Acquisition Corp that values the office-sharing startup at $9 billion including debt.

The company disclosed to prospective investors it had lost about $3.2 billion last year as part of a pitch for a stock market listing by merging with a special purpose acquisition company (SPAC).

The office-sharing startup’s plans for its high-profile initial public offering imploded in October 2019 due to investor concerns over the office-sharing startup’s business model and its founder Adam Neumann’s management style.

The company is also raising $1.3 billion in capital, including $800 million in private investment from Insight Partners, funds managed by Starwood Capital Group, Fidelity Management and others, the Journal reported.

A SPAC is a shell firm that uses proceeds from an IPO to buy a private firm.

WeWork was valued at nearly $47 billion in 2019 but saw its valuation plummet to roughly $8 billion after SoftBank was forced to extend a life-saving financing lifeline to WeWork.

BowX Acquisition raised $420 million in its IPO in August last year.


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