WeWork to merge with a SPAC in a deal that would raise $1.3B and values the company at $9B
at a greatly reduced valuation New York Times : After Failed I.P.O., WeWork Will Go Public Through a Merger Anthony Spadafora / TechRadar : WeWork merges with SPAC in going public PYMNTS.com : WeWork Planning Public Offering With BowX SPAC Merger Aaron Pressman / Fortune : What happens when a cheap phone suddenly turns expensive Crunchbase News : The Briefing: UiPath Files To Go Public, Robinhood Plans IPO Buying Feature, And More DealStreetAsia : Office-sharing startup WeWork takes SPAC route to go public in $9b deal Larry Dignan / ZDNet : WeWork to go public via SPAC deal, aims to be part of future of work Lisa Fickenscher / New York Post : WeWork reportedly cuts deal to go public with SPAC Ortenca Aliaj / Financial Times : WeWork to merge with Spac in $9bn deal Brody Ford / Bloomberg : WeWork Makes $9 Billion SPAC Deal in New Path to Go Public The Economic Times : WeWork attempts to go public again, this time through a SPAC Wire / WRAL TechWire : WeWork, which has major presence in Triangle, is going public through a SPAC Michael Grothaus / Fast Company : WeWork is finally going public via a SPAC after abandoning an IPO in 2019 Tweets: Joshua Franklin / @reutersjf : .@WeWork's SPAC merger with $BOWX now official at $9B valuation. WeWork expects to be (adjusted) EBITDA positive in 2022 and revenue to more than double by 2024 https://www.wework.com/... https://twitter.com/... Anthony DeRosa / @anthony : WSJ EXCLUSIVE: WeWork has agreed to merge with a SPAC, in a deal valuing the company at $9 billion that would take the shared-office provider public https://www.wsj.com/... Diogenes / @wallstcynic : The WeWork CEO just said they are hoping for $1B in 2023 cash flow. That's an implied 11% cap rate in two years. If so, why are $SLG and $VNO trading at 5-6% cap rates with rents still declining? https://www.wsj.com/... Litquidity / @litcapital : Spongebob French voice: “a few months later” https://twitter.com/... Kontra / @counternotions : WeWork's champagne dreams on beer reality: 2019: $50B IPO 2021: $9B SPAC (Has to be Covid-19, obviously.) https://www.wsj.com/... @wsj : WeWork agreed to merge with a SPAC, in a deal that would take the startup public nearly two years after its high-profile failure to launch a traditional IPO https://www.wsj.com/... Dan Primack / @danprimack : Few weeks late — or couple yrs, depending on your point of view — WeWork has deal to go public https://www.wsj.com/...
Context & Ripple Effects
WeWork’s return to public markets follows its failed IPO effort, when amended filings and governance changes were paired with a sharply lower targeted valuation. The company had also moved from a 2016 financing valuation of about $16B to SoftBank’s takeover-era valuation of $7.5B to $8B.
January reporting had already identified a possible SPAC transaction at roughly a $10B valuation. The BowX agreement makes that route concrete, supplying new capital while setting a $9B benchmark for the company’s public-market debut.
First-order effects
- WeWork gains a path to become public and access $1.3B in proceeds through BowX rather than restarting a conventional IPO process.
- BowX shareholders are being asked to back WeWork at a $9B valuation, turning the company’s recovery from a private-company question into a public-market one.
Second-order effects
- The transaction gives WeWork a financing route after the earlier IPO reset, while making BowX’s value depend directly on investor acceptance of the revised valuation.
- SoftBank, which previously took control of WeWork, now has a public-market reference point closer to its takeover-era valuation than to WeWork’s 2016 private-financing mark.
Third-order effects
- If comparable companies use SPACs after stalled IPOs, the route can become a more durable mechanism for repricing heavily funded private businesses rather than preserving their last private valuation.
- Public investors may increasingly become the final arbiters of governance and valuation resets that previously played out between founders and late-stage backers.
The trend: SPAC mergers are becoming an alternative path for venture-backed companies seeking public-market financing after a conventional IPO process breaks down.