WeWork has agreed to merge with a special-purpose acquisition company, according to people familiar with the matter, in an agreement that would take the public to the shared office provider nearly two years after its major failure to launch a traditional stock exchange.
The planned merger with BowX Acquisition Corp. SPAC would value WeWork at $ 9 billion including debt, people said. WeWork would also raise $ 1.3 billion, including $ 800 million in a so-called private equity investment, or PIPE, from Insight Partners, funds managed by Starwood Capital Group, Fidelity Management and others, people said.
In January, the Wall Street Journal reported that WeWork was in talks to combine it with BowX.
WeWork is a major player in the flexible office market. He signs long-term leases with landlords and, after renovating a space and furnishing it, sublet to tenants small offices or even entire buildings for just one month at a time. If the merger closed in the coming months, as expected, it would limit what has been a long, bumpy road to a WeWork listing.
The company takes advantage of a torrent of new SPACs to achieve what it failed to achieve in 2019, when public investors rejected the losing company and its visionary but erratic leader, Adam Neumann, who later resigned as to Chairman and Chief Executive Officer. More affected by the coronavirus pandemic, which has emptied offices across the country, WeWork has closed locations, renegotiated leases and cut thousands of jobs to cut costs.