WeWork looking to raise more than $4b in debt ahead of IPO: Report, Latest Business News - The New Paper

WeWork looking to raise more than $4b in debt ahead of IPO: Report

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NEW YORK : Shared office space manager WeWork is looking to raise US$3 billion (S$4.08 billion) to US$4 billion in debt before it goes public, a person familiar with the matter said on Sunday, in a move aimed to fuel investor confidence in the company.

The potential debt offering underscores the extent to which the disappointing public market debuts for Uber Technologies and Lyft prompted other loss-making start-ups with lofty valuations looking to go public to reassess their plans.

Uber and Lyft went public earlier this year with high expectations but faced criticism from investors about steep losses and lack of a timetable to reach profitability.

WeWork has faced questions about the sustainability of its business model, which is based on short-term revenue agreements and long-term loan liabilities.

A substantial debt offering could allow it to pitch itself to potential investors in a planned initial public offering (IPO) as having sufficient funding to see itself to profitability. The money raised from the debt offering, which will be separate from funds WeWork would receive in an IPO, could grow as big as US$10 billion over the next few years, the source said. - REUTERS