Shared-office provider WeWork has agreed to merge with special-purpose acquisition company BowX Acquisition Corp. to go public, according to a report by Wall Street Journal.
- As part of the deal, WeWork will raise $1.3 billion. This includes $800 million in private investment in public equity (PIPE) from Insight Partners, funds managed by Starwood Capital Group, Fidelity Management, and others.
- The planned SPAC values WeWork at $9 billion, including debt, far from the $47 billion valuation in a private round of financing from SoftBank Group Corp. in 2019. The Japanese tech investor then rescued WeWork and now holds a majority stake.
- Vivek Ranadive who runs SPAC’s sponsor Bow Capital Management, and Deven Parekh of Insight Partners are to join WeWork’s board.
- WeWork failed to go public in 2019, when public investors rejected the money-losing company and its former chairman and chief executive officer Adam Neumann who resigned thereafter.
- The SPAC raised $420 million in 2020 as an empty shell. Its shares rose 3.7% to $10.10 in premarket following the announcement.