NEW YORK – Office-sharing company WeWork said on Monday it was scrapping plans for an initial public offering (IPO), with the announcement coming less than a week after co-founder Adam Neumann stepped down as CEO.
“We have decided to postpone our IPO to focus on our core business, the fundamentals of which remain strong,” WeWork interim co-CEOs Artie Minson and Sebastian Gunningham said in a statement.
WeWork said it would withdraw the S-1 form filed on Aug. 14 with the Securities and Exchange Commission (SEC) outlining its intent to become a publicly listed company.
“We are as committed as ever to serving our members, enterprise customers, landlord partners, employees and shareholders. We have every intention to operate WeWork as a public company and look forward to revisiting the public equity markets in the future,” Minson and Gunningham said.
On Sept. 24, Neumann agreed to step down as CEO, although he is staying on as non-executive chairman of parent We Company, following a rocky IPO process that included an initial plan to postpone going public until the end of the year following a poor reception by investors.
In mid-August, the coworking company, whose founders are Miguel McKelvey, Adam Neumann and Rebekah Neumann, said it planned to go public, but WeWork quickly faced resistance from investors over its valuation and questions about Adam Neumann’s management of the business and public image.
WeWork, which is based in New York, was initially valued at $47 billion, making it one of the most valuable start-ups to go public recently.
Reports in the business press, however, said ahead of the IPO that the company’s valuation might fall to $20 billion or less.
The company, according to filings with securities regulators, posted a net loss of $1.9 billion in 2018 and had a loss of $900 million on revenues of $1.54 billion in the first half of 2019.