WeWork buys peer startup in first acquisition since Newman
(Bloomberg) – WeWork Inc. is making its first acquisition as a public company – and the first since its current chief executive officer, Sandeep Mathrani, took over from co-founder of the peer company, Adam Newman.
New York-based WeWork has agreed to buy Common Desk, a coworking startup with 23 locations in Texas and North Carolina. Common Desk will continue to operate as an independent brand. The majority of Common Desk locations – 19 of 23 – are operated under management agreements, a common arrangement in the hotel industry that allows the company to run a space and collect a portion of the rental revenue without entering into a long-term traditional lease. allows to do. WeWork said it is aiming to pursue more management agreements in the future.
The acquisition is directly related to WeWork’s core business, a feature that is in contrast to some of WeWork’s Newman-era acquisitions, in which the company bought startups with far-flung business models such as online coding schools and Meetup.com. Many of those acquisitions were sold in 2019 amid an unsuccessful attempt at an initial public offering after Newman left the company.
Last year, WeWork made a run in the public markets again, this time through a merger with a special-purpose acquisition company. Shares of WeWork are down about 20% since its October listing, giving the company a market cap of $5.7 billion.
WeWork and Common Desk declined to provide transaction prices.
To contact the author of this story: Ellen Huet at San Francisco [email protected]
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