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WeWork's owner The We Company is targeting an initial market valuation of less than half of the year-end estimates, according to a report released on Thursday, another sign of increasing investor skepticism about important but unprofitable technology names .
FILE PHOTO: The WeWork logo is displayed on the entry of a collaborative workspace in New York, NY, January 8, 2019. REUTERS / Brendan McDermid
REUTERS: WeWork's owner The We Company is targeting an initial market valuation of less than half of the year-end estimates, according to a report released on Thursday, another sign of increasing investor skepticism about the names of new technology. both important and unprofitable.
The company, which should be on the list soon, considers a valuation between 20 and 30 billion US dollars, said Bloomberg, citing people familiar with the matter, well below the $ 47 billion projected early in the year. year.
The company, led by co-founder Adam Neumann, seeks to make itself known in a tumultuous market context. The trade war between the United States and China is the worst August for Wall Street in four years.
The lower valuation also shows that despite the company's dizzying growth, the mismatch between its cash flow and its liabilities is raising concern as well as doubts about its corporate governance.
Our company leases work space to its clients on short-term contracts, even if it pays rent to them under long-term leases.
WeWork, which was renamed We Company earlier this year, is supported by the Japanese group SoftBank, which has invested or pledged US $ 10.65 billion since 2017.
(Report by Bharath Manjesh in Bengaluru and Joshua Franklin in New York, edited by Anil D & Silva and Arun Koyyur)
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