WeWork is exploring a dramatic reduction in its $47 billion valuation as it aims to go public while facing widespread skepticism over its business model. If the IPO ever makes it out of the gate, the company would sell shares at a price that pegs its value closer to $20 billion.
- Interesting wrinkle: Adam Neumann met with SoftBank’s Masayoshi Son in Tokyo last week to discuss a potential capital infusion by the Vision Fund to enable the co-working company to delay the IPO until 2020. SoftBank owns about 29% of the company, while Neumann currently has a 22% stake, Bloomberg noted.
- Worth Noting: IWG has a stock market value of about $4.5 billion, even though it is profitable with roughly the same revenue as WeWork in the first half of this year.
- High stakes: A botched IPO could frustrate WeWork’s expansion plans and jeopardize its ability to borrow money. Banks have agreed to lend the company as much as $6 billion, but that commitment rests on their ability to raise at least $3 billion in the public offering.
- Heard on the Street: Fitch Ratings told WSJ: “If they did not complete the I.P.O., we would need to potentially reconsider their credit profile.”