WeWork to Go Public in October Through BowX Acquisition Corp. SPAC

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After a derailed initial public offering (IPO) process, WeWork might finally start trading next month.

BowX Acquisition Corp., a special acquisition company (SPAC) that agreed to take WeWork public in a $9 billion deal earlier this year, has filed a definitive proxy statement with the embattled coworking company, ahead of a vote on Oct. 19 that will determine whether or not WeWork becomes a publicly traded company.

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If approved by BowX shareholders, the SPAC expects the deal to close and WeWork to start trading around Oct. 21, WeWork said in a statement.

The deal, which values WeWork at $9 billion, is a far cry from the company’s eye-popping valuation of $47 billion in 2019, but an improvement of its $2.9 billion valuation last year.

This isn’t the first time WeWork tried to go public. 

The coworking giant attempted it in 2019 through the more traditional IPO process, but it faced concerns over its cash-burning business model and conflicts of interest from its former CEO, Adam Neumann. Neumann later stepped down and WeWork pumped the brakes on its IPO later that year.

The BowX deal would provide WeWork with a $1.3 billion cash infusion, the coworking company said in March, after both WeWork and BowX’s boards approved the merger. WeWork will also get $800 million from private equity and venture capital firm Insight Partners as well as funds managed by Starwood Capital Group, Centaurus Capital and Fidelity Management & Research Company, alongside funds and accounts managed by BlackRock, CO reported.

BowX — which counts NBA legend Shaquille O’Neal as an adviser — raised $483 million last year to form a SPAC, a shell firm using proceeds from a public listing to buy a private firm. It has been in talks to merge with WeWork since at least January, CO reported.

While SPACs boomed in 2020, the trend has started to slow this year, amidst increased scrutiny from the U.S. Securities and Exchange Commission and disappointing stock performance. And some startups have begun to sour on SPACs and turn down merger offers, The Wall Street Journal reported.

Celia Young can be reached at cyoung@commercialobserver.com.