Home Business WeWork to List Shares on Nasdaq, Make Governance Changes – The Wall Street Journal

WeWork to List Shares on Nasdaq, Make Governance Changes – The Wall Street Journal

17 min read

We and its advisers are targeting a valuation that could slip below $20 billion.


Adam Glanzman/Bloomberg News

WeWork’s parent company has chosen to list its shares on Nasdaq and plans sweeping changes in its governance as the shared-workspace provider speeds up preparations for its hotly anticipated initial public offering in the face of tepid interest from investors.

The moves are part of a plan by We Co., as the company is officially known, to begin officially marketing the shares to investors next week ahead of a trading debut the week of Sept. 23, people familiar with the matter said.

The company is expected to set a preliminary price range by next week and We and its advisers are targeting a valuation that could slip below $20 billion, as The Wall Street Journal has previously reported. That’s significantly lower than the $47 billion valuation set in a funding round earlier this year, reflecting skepticism over the company’s governance and its ability to reverse steep losses.

We Co-founder and Chief Executive Adam Neumann controls a majority of the company’s voting rights through special shares whose potency was recently enhanced.

His wife, Rebekah Neumann—also a We co-founder—is one of three people designated to serve on a committee that would choose Mr. Neumann’s successor if he dies or is permanently disabled in the next 10 years.

Potential investors have also questioned Mr. Neumann’s sales of hundreds of millions of dollars of We stock and loans of more than $740 million tied to his shares in the company, according to Wall Street Journal reports and regulatory filings.

We officials and their advisers have been in an intensive series of meetings in recent days as questions swirl over whether the company will go through with the offering, one of the biggest in what could be a record year for new issues. But the choosing of a listing venue, together with the expected valuation cut and governance overhaul, show that it has decided to plow forward—even if that means raising less that it had originally hoped.

One major motivating factor is $6 billion in loans We has arranged that are contingent on at least $3 billion being raised in the share offering.

The IPO frenzy this year has kicked up a heated battle between the NYSE and Nasdaq, which see big IPOs as franchise-defining opportunities that can help land subsequent business, become key marketing tools and represent new sources of trading revenue. The listing of We has been seen as one of the biggest prizes of the second half of the year after Nasdaq landed


and the New York Stock Exchange landed

Uber Technologies

and the direct listing of

Slack Technologies

in the first half.

In the coming weeks, Peloton Interactive Inc. is planning to debut on Nasdaq and Endeavor Group Holdings Inc., the parent company of Hollywood’s biggest talent agency, is slated to start trading on the NYSE.

We waited an unusually long time to decide on an exchange. Typically, large companies select one by the time they file publicly for an IPO. There are some companies that wait longer, but the most buzzed about IPOs of the past few years have picked a trading venue much further in advance of We’s timing—just days before the start of its investor roadshow—in a sign of the behind-the-scenes scramble to keep the listing on track.

Despite questions and concerns from investors, Mr. Neumann has said privately he is committed to moving forward with the IPO.

In conversations earlier this week with executives of

SoftBank Group

, the company’s largest shareholder, Mr. Neumann said he doesn’t expect anything fundamental to change in the next year and that he thinks the most important thing now is to get a large infusion of cash so he can continue his expansion plans, people familiar with the matter said.

Write to Maureen Farrell at maureen.farrell@wsj.com and Corrie Driebusch at corrie.driebusch@wsj.com

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