WeWork jumps as much as 12% in public debut
18:39, 21 October 2021
WeWork traded up more than 12% to highs of $13.93 per share in its debut on the public markets.
The co-working real-estate company went public on Thursday through a merger with special purpose acquisition company BowX Acquisition, two years after its initial public offering imploded spectacularly and became the subject of documentaries and a dramatised TV series.
BowX shares closed at $11.18 per share on Wednesday before the stock was delisted from the Nasdaq and relisted on the New York Stock Exchange at $10 per share as WeWork under the ticker “WE.” At 2:30 Eastern Time, the shares were trading at $11 per share, up by around 6% on the day.
The deal values WeWork at $9bn (£6.52bn), which stands in stark contrast to the $47bn valuations it once flaunted before former CEO and founder Adam Neumann’s controversial management style came under fire and the company’s business projections proved to be too lofty.
Japanese conglomerate SoftBank continues to be the company’s largest shareholder with a 61% stake. Softbank ended up bailing out WeWork after the company withdrew its IPO, sinking $16bn into the efforts, including $11bn of equity investment and $5bn of debt financing and payments to the ousted Neumann.
Some investors worry that any increase in the shares could trigger SoftBank to begin dumping its shares as a way to recoup those earlier costs.
During WeWorks’ investor day earlier this month, the company reported preliminary third-quarter revenue of $658m.
The company withdrew its IPO in late 2019 and was then met with the challenges of the pandemic as office spaces emptied out in favor of at-home work.
WeWork is looking at new revenue models as well including “All Access” subscriptions that give members access to all of WeWork’s locations. Additionally, the company is working to roll out a workplace management platform that will allow landlords the ability to manage flexible spaces themselves.
Read more: WeWork set to go public on NYSE following successful vote
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