New York-based co-working unicorn WeWork is reportedly in talks to buy back stake in its India operations, and take it to 51 percent, in a deal that could be worth around $1 billion.
The company’s India operations are currently managed by Jitu Virwani, Chairman and Managing Director of real estate giant Embassy Group through a licensing deal that ends in 2021. WeWork, founded by Adam Neumann and Miguel McKelvey in 2010, has about 20 office spaces in India across Gurugram, Mumbai and Bengaluru. Overall, the office space provider has 400,000 members at 425 locations in 100 cities across 27 countries.
A recent study by real-estate consulting firm Jones Lang LaSalle shows the demand for shared working spaces in India is likely to go up by as high as 40 percent in 2018. It also estimates that by 2020, roughly 13.5 million Indians will operate out of such co-working facilities.
Some of the offerings by the co-working spaces provider include event spaces, brainstorming rooms, wellness rooms, and even pet-friendly areas. It also offers casual meeting spaces, lounges, private phone booths, F&B options, 24X7 WiFi, conferencing facilities.
Investor sentiment for WeWork
WeWork had, on January 8, announced that it had received an investment of $6 billion from SoftBank, down from the $16 billion committed earlier. Of this total investment, $5 billion will be infused as primary growth capital and the rest will be secondary capital. The $1 billion will be used to fund share purchases from investors and employees. With the latest fund-raise, the company’s valuation has touched $47 billion, news reports said. SoftBank’s total investment in the office space provider is around $10 billion.
It has also rebranded itself as The We Company with three business verticals – WeWork, WeLive, and WeGrow. Through these, it is looking to expand its business operations beyond just office spaces to co-living spaces and even education.