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WeWork co-founder Adam Neumann, who was ousted as CEO of the bankrupt co-working space provider four years ago, is trying to buy back the company through his new venture, Flow Global Holdings.
It was first reported in a letter to WeWork dated Tuesday. Provided by: DealBooklawyers representing Newman and Flo accused WeWork of rejecting their customers’ repeated efforts to buy WeWork or provide funds to help them through bankruptcy proceedings.
Adam Newman speaks at the Israeli American Council (IAC) 8th Annual National Summit on January 19, 2023 in Austin, Texas. (Shahar Azlan/Getty Images)
The letter, signed by attorney Alex Spiro, alleges that Newman and Flo have partnered with prominent financial sources, including “Dan Loeb’s Third Point” hedge fund, to finance their transactions. “We regret WeWork’s lack of involvement.” It is also to provide information to clients with the aim of making transactions that maximize value for all stakeholders. ”
When asked for comment by FOX Business, WeWork issued the following statement: “WeWork is an extraordinary company, which is why we regularly receive expressions of interest from external parties. We and our advisors always consider those approaches from the perspective of: ” Act in the best interests of the company. ”
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The spokesperson added: “Our ongoing efforts to address unsustainable rent spending and restructure our business will ensure WeWork remains independent, valuable, financially strong and sustainable into the future.” We continue to believe that we can secure the best possible position as a possible company.”
WeWork logo on an office building in Tel Aviv, Israel, December 29, 2022. (Jakub Porzycki/NurPhoto via / Getty Images)
Meanwhile, Third Point said it is only in early-stage negotiations with Mr. Neumann and his current company regarding financing for WeWork and is not committing to any deal at this time.
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The hedge fund told CNBC in a statement: “Third Point has only had preliminary conversations with Mr. Flo and Mr. Adam Neumann about the WeWork idea and has not committed to participating in any transaction.” Stated.
Neumann founded WeWork in 2010 with a value proposition that appealed to small businesses and startups looking to shrink their footprint. The company has grown rapidly and first attempted to go public in 2019 with an estimated valuation of $47 billion, but investors were put off by its high debt levels and huge losses.
WeWork co-founder Adam Neumann was ousted as CEO of the bankrupt co-working space provider four years ago. (Shahar Azlan/Getty Images)
He was fired in late 2019 after investors complained about his spending levels, but was paid hundreds of millions of dollars in dividends. After negotiations with SoftBank, which had bailed out the company when its initial listing plan failed, WeWork was renegotiated to go public in 2021, albeit without a profit.
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Mr. Neumann founded residential real estate venture Flow in 2022 with an initial investment of $350 million from Andreessen Horowitz.
WeWork filed for bankruptcy in November.
FOX Business’ Eric Revell contributed to this report.
