It appears that billionaire entrepreneur Adam Neumann could be making a comeback to WeWork (OTCMKTS:WEWKQ). This news has sent WEWKQ stock up 100% today.
Last November, the company filed for Chapter 11 bankruptcy protection. Neumann, who founded WeWork, left the company way before that in 2019. In 2021, he generated quite a bit of controversy after receiving $245 million in WeWork shares and $200 million in cash as part of his exit package.
Based on a letter sent yesterday to WeWork’s advisors from Neumann’s lawyer, Neumann is open to submitting a proposal to acquire WeWork through his real-estate company, Flow Global. Flow has already partnered with several capital sources, such as Dan Loeb’s Third Point, a hedge fund with over $15 billion in assets under management (AUM).
WEWKQ Stock: Founder Adam Neumann Wants to Buy Back WeWork
In October of 2022, Flow had tried to set up a meeting with WeWork in order to provide it with up to $1 billion of financing. WeWorks’ former CEO canceled the meeting. Flow gave it another shot before the company filed for bankruptcy, offering a “substantial equity infusion.” The meeting to discuss the infusion was canceled as well. Yesterday’s letter reiterated Neumann’s previous offerings:
“In a hybrid work world where demand for WeWork’s product should be greater than ever, my clients believe that the synergies and management expertise offered by an acquisition by my clients could significantly exceed the value of the Debtors on a stand-alone basis.”
In December, Flow met with WeWork’s debtors and proposed options to buy the company, buy its assets, or provide it with debtor-in-possession (DIP) financing. After several weeks of delays, WeWork or its advisors suggested a DIP proposal, to which Flow responded by creating a $200 million DIP facility proposal. WeWork did not respond with the necessary information after Flow submitted its proposal.
“We reiterate my clients’ request for engagement by WeWork so that they can provide the estates and their stakeholders an Alternative Restructuring Proposal to consider,” read the letter.
Neumann is currently open to submitting proposals to either purchase the entire company or its assets. It appears that the ball is in WeWork’s court as Neumann awaits a response.
On Penny Stocks and Low-Volume Stocks: With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.
Read More: Penny Stocks — How to Profit Without Getting Scammed
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
