Daily Management Review

WeWork postpones IPO due to weak investor interest


The American coworking startup WeWork has postponed the initial public offering due to the weak interest of institutional investors. On September 16, the company was going to hold a road show for investors, and to conduct a listing the following week. However, the IPO has been postponed until the end of the year.

According to the newspaper, some investors fear excessive influence on WeWork by its CEO Adam Neumann, and also note its growing operating losses. Over the past few years, the company has lost about $ 3 billion.

A day earlier, the Wall Street Journal wrote about IPO postponement. The newspaper noted investors' doubts about the real value of the startup and their criticism of company management practices. According to the WSJ, the road show for investors has now been postponed no later than mid-October, while the Japanese SoftBank recommended that the company wait until 2020.

Last week, WeWork held negotiations with SoftBank, its largest investor. According to FT, SoftBank's top executives called on Neumann to postpone the listing of shares. He refused, and now it is not clear whether the Japanese company is ready to continue investing in startups. SoftBank and its Vision Fund have already invested or promised to invest $ 10.7 billion in the company.

Postponement of the IPO deprives WeWork of the opportunity to receive a loan of $ 6 billion from a consortium of banks, which depends on the successful placement of shares this year. If WeWork is unable to conduct an IPO before the end of the year, it will have to develop a new financial plan. 

source: wsj.com, ft.com