WeWork Eyes SaaS SpaceIQ Acquisition Pre-IPO

WeWork Eyes SaaS SpaceIQ Acquisition Pre-IPO

Initial public offering (IPO) talks continue for co-working company WeWork as it moves to acquire software startup SpaceIQ, people familiar with the matter told CNBC.

    Get the Full Story

    Complete the form to unlock this article and enjoy unlimited free access to all PYMNTS content — no additional logins required.

    yesSubscribe to our daily newsletter, PYMNTS Today.

    By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions.

    Silicon Valley-based SpaceIQ, which develops management and analytics software for making efficient use of office space, could help WeWork appear more like a technology company as it gears up for its IPO. SpaceIQ has raised about $11.5 million in venture funding.

    WeWork is now worth $47 billion as it moves to go public in September through its parent, The We Company. It could potentially be the second-biggest IPO of 2019. (Uber currently holds the top spot with its $8.2 billion IPO earlier this year.) WeWork’s preliminary paperwork was filed in May.

    WeWork rebranded to The We Company earlier this year to reflect its expansion beyond the co-working market. The company was last valued at around $36 billion after Japanese technology and telecommunications giant SoftBank invested about $2 billion in the company in January. WeWork lessened its loss to $264 million in the first quarter, while revenue more than doubled to $728.3 million.

    The company is also looking for a $2.75 billion credit line in anticipation of the IPO, which is typical of what firms do before going public. WeWork was the recipient of a $650 million revolver in 2014 from JPMorgan that expires in late 2020. Its junk-rated bonds, which were priced in 2018 and are due in 2025, were at $93.50, which is down from $99.63 earlier in May.

    While WeWork doesn’t own much in the way of property, it has a valuation that is more than double that of Boston Properties, which is one of the biggest owners of high-quality office buildings in the country. WeWork’s losses are also ballooning, but it has secured significant funding from investors and has aggressive plans for global expansion.