WeWork has officially decided to yank its planned stock market listing, just days after Adam Neumann was forced to step down as the chief executive officer of the office-sharing startup that he co-founded with Miguel McKelvey nine years ago.
“We have decided to postpone our IPO to focus on our core business, the fundamentals of which remain strong,” said WeWork’s newly-appointed Co-CEOs Artie Minson and Sebastian Gunningham in a joint statement on Monday.
“We are as committed as ever to serving our members, enterprise customers, landlord partners, employees and shareholders. We have every intention to operate WeWork as a public company and look forward to revisiting the public equity markets in the future,” the statement reads.
WeWork’s parent, the We Company, submitted a request with the U.S. Securities and Exchange Commission (SEC) to officially withdraw its S-1 registration that was initially filed on Aug. 14. The company had sought to offer enough shares to raise about $4 billion in its initial public offering. WeWork posted losses of $1.9 billion last year and generated revenue of $1.8 billion, according to its S-1 registration.
Last week, WeWork’s board of directors ousted Neumann after intense criticism of his corporate governance as well as the company’s earnings prospects. Neumann reportedly cashed out $700 million by borrowing against shares and through sale of stocks ahead of the company’s market debut. He will, however, continue to serve as non-executive chairman of the board of directors.
The Wall Street Journal also reported that Neumann was left stranded in Israel last summer after a private jet chartered by him had to be grounded after a “sizable chunk” of marijuana was found onboard. Neumann is also said to have stated that the company would one day “solve the problem of children without parents,” and eradicate “world hunger,” according to the Journal.
“While our business has never been stronger, in recent weeks, the scrutiny directed toward me has become a significant distraction, and I have decided that it is in the best interest of the company to step down as chief executive,” Neumann said in his resignation statement last week.
WeWork is bankrolled by Japanese conglomerate SoftBank and was valued at $47 billion after its last round of private fundraising. However, that figure dropped to under $20 billion after lawmakers and outside investors raised eyebrows.
WeWork provides shared workspaces by turning leased buildings into co-working spaces that offer perks such as yoga classes. The New York-based company has recently expanded into education, apartment rentals, and data analytics. The business began operations in 2010 and has never been profitable.