WeWork is selling its whole shareholding in India in order to depart the market
WeWork Inc., a major US coworking company, intends to completely leave the Indian market. “US office-sharing company WeWork Inc. is set to exit the Indian operations by selling its entire 27% stake in the local unit through a secondary transaction, said multiple people in the know,” according to an exclusive story in the Economic Times. The Embassy Group and WeWork Inc. established a joint venture in 2017.
for the international co-working business to open in India.
According to reports, the business is offloading 27% of its ownership to the local operation. The real estate developer Embassy Group, located in Bengaluru, will also control less of the transaction; its shareholding would drop from 73% to 60%.
The sources for the story state that a group of new investors will purchase the 40% of shares that WeWork and Embassy Group have divested together. Among these investors are Mithun Sacheti, the creator of CaratLane, the Enam Group family office, and investment company A91 Partners.
The deal is pending CCI clearance.
WeWork Inc. was cofounded by Adam Nuemann and Miguel McKelvey, and it declared Chapter 11 bankruptcy in November of last year. WeWork’s Indian division had sales of Rs 1,300 crore in FY23, an increase of almost 68%, in stark contrast to the failure of its US operations. During the year, net losses decreased by 80% to Rs 146 crore. The merger is now pending clearance from the Indian Competition Commission (CCI).
This announcement coincides with a post-pandemic rebound in India’s need for co-working spaces. Positive development is also being seen in a number of other co-working spaces, such as Bhive, Indiqube, CoWorks, 91Springboard, and Awfis, which is funded by Peak XV Partners and plans to go public later in 2024.
With 90,000 workstations around the country and over 70,000 paying members, WeWork India serves a broad range of customers. About 80% of the company’s customers are huge corporations, but it also works with startups and other small firms.
