WeWork Delays IPO Plans For Now

Jim Cramer is sort of getting what he wished for: WeWork has made the decision to hold off on its highly publicized initial public offering.

What Happened

WeWork, the office-sharing startup company, was valued as high as $47 billion during private rounds of financing but may now be worth between $10 billion and $12 billion. The company was set to launch its investor road show this week, but made a last-minute decision to scrap its plans.

Management experts and investors expressed concerns related to WeWork's management team and corporate governance. In addition, investors expressed concerns with the company's financials, including its $47 billion in fixed lease payments it has to make.

Why It's Important

WeWork raised close to $13 billion throughout its nine-year history and a potential listing below this figure would represent a major blow to investors, especially its biggest back Japan's SoftBank, Reuters noted.

WeWork isn't fully giving up on its IPO plans and told WSJ it expects to list its stock on a public market by the end of the year. The company needs to proceed with an IPO as part of a $6 billion credit line, which states WeWork needs to raise at least $3 billion through the public market or to find alternative financing.

Related Links:

Management Pro: Too Much Is Wrong With WeWork

WeWork Considers Valuation Cut As Investors Question IPO Values