WeWork co-founder Adam Neumann, ousted four years ago as CEO of the now-bankrupt co-working space provider, is trying to buy the company back through his new venture, Flow Global Holdings.
In a letter to WeWork dated Tuesday, first reported by DealBook, an attorney representing Neumann and Flow accused WeWork of rebuffing his clients’ repeated efforts to purchase WeWork or provide it with funds to support it through the bankruptcy process.
The letter, signed by attorney Alex Spiro, said Neumann and Flow “are partnering with well-known capital sources including Dan Loeb’s Third Point” hedge fund and others to obtain the funding to make a deal, and expressed “dismay with WeWork’s lack of engagement even to provide information to my clients in what is intended to be a value-maximizing transaction for all stakeholders.”
When reached for comment by FOX Business, WeWork issued a statement that reads, “WeWork is an extraordinary company. As such, we receive expressions of interest from external parties on a regular basis. We and our advisors always review those approaches with a view to acting in the best interests of the company.”
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The spokesperson added, “We continue to believe that the work we are currently doing – addressing our unsustainable rent expenses and restructuring our business – will ensure WeWork is best positioned as an independent, valuable, financially strong and sustainable company long into the future.”
Meanwhile, Third Point says it is only in early talks with Nuemann and his current company regarding WeWork funding, and has not committed to any deal at this point.
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The hedge fund told CNBC in a statement, “Third Point has had only preliminary conversations with Flow and Adam Neumann about their ideas for WeWork, and has not made a commitment to participate in any transaction.”
Neumann founded WeWork in 2010 with a value proposition that appealed to small businesses and startups that wanted a smaller footprint. It grew rapidly and first tried to go public in 2019 when it had an estimated valuation of $47 billion – but investors balked at its high debt level and massive losses.
He was ousted later in 2019 amid frustration by investors with his spending levels, but was provided a payout amounting to several hundred million dollars. Following negotiations with SoftBank, which provided a bailout to the firm when its first bid to go public failed, the deal was renegotiated to allow WeWork to go public in 2021 – although it failed to turn a profit.
Neumann went on to found Flow, a residential real estate venture, in 2022, receiving an initial investment of $350 million from Andreessen Horowitz.
WeWork filed for bankruptcy in November.
FOX Business’ Eric Revell contributed to this report.
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