Sunday, October 1, 2023

WeWork Withdraws its ill-fated IPO

By ET Bureau - October 01, 2019 1 Mins Read

WeWork, IPO

WeWork’s parent, ‘The We Company’ filed to withdraw its initial public offering, a week after the SoftBank-backed office-sharing startup ousted founder Adam Neumann as its chief executive officer.

The withdrawal of its IPO prospectus formalizes the end of the New York-based company’s pursuit of a near-term listing and allows Neumann’s successors to proceed with the company’s financial turnaround without disclosing as much information publicly.

The company’s high-yield bond price slid to a record low after the move was announced earlier in the day.

The scrapping of the IPO marks the conclusion of a tumultuous few weeks for the office-sharing firm, which failed to excite investors who raised concerns about its burgeoning losses and a business model that involves taking long-term leases and renting out spaces for a short term.

According to the IPO prospectus, it filed earlier in September, We Company had cash and cash equivalents of roughly $2.5 billion as of June 30. However, while revenue doubled to nearly $1.8 billion in 2018, its losses also more than doubled to $1.9 billion.

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