WeWork Takes the SPAC Route to Go Public in a $ 9 Billion Deal
WeWork, the high-flying shared office start-up that fell out of favor during a revealing IPO process in 2019, will finally make its debut on the stock market, but not through the traditional IPO route. Check out the BowX Acquisition Corp firm, into a special purpose acquisition company, or SPAC, a merger that’s been all the rage on Wall Street lately. A SPAC is a shell firm that uses the proceeds of a public listing to buy a private firm like WeWork. When the two merge, the private company takes over the negotiation of shares in the SPAC. Leveraging the stock market through a SPAC requires less regulatory oversight and investor scrutiny than a traditional IPO. In the deal announced Friday, WeWork is valued at $ 9 billion. That’s a big drop from the $ 47 billion valuation during its failed 2019 IPO. The original stock market listing was scrapped amid widespread concerns about WeWork’s business model and its management style. founder Adam Neumann. WeWork eventually had to be bailed out by major shareholder SoftBank. WeWork’s market debut will come at a time of uncertainty about the future. From office work, as economies open up, people get vaccinated and employers determine how many workers need, or want, to return to the office after working from home during the health crisis. WeWork told potential merger partners it lost about $ 3.2 billion last year, sources familiar with the talks earlier this week told Reuters.