WeWork (OTCMKTS:WEWKQ) stock gained more than 200% yesterday on the news that the firm’s founder, Adam Neumann, had made a bid to buy the company out of bankruptcy. According to the latest reports, Neumann plans to bid above $500 million for the firm. WEWKQ stock is currently traded on an over-the-counter exchange and closed yesterday at 25 cents.
Despite yesterday’s massive spike in price, WEWKQ is still down 91% in the past six months.
Neumann’s Offer
Neumann’s firm reported that it had about six “financing partners” for the bid. According to CNBC, the bid could ultimately increase to $900 million. CNBC cited an unnamed individual as the source for the latter information.
“WeWork is an extraordinary company and it’s no surprise we receive expressions of interest from third parties on a regular basis,” the firm told the news service in a statement. “Our board and our advisors review those approaches in the ordinary course, to ensure we always act in the best long-term interests of the company,” WeWork noted.
However, the firm indicated that it’s occupied with coming out of bankruptcy next quarter.
In February, Neumann told WeWork that he was developing “a joint bid” for the firm with renowned investor Daniel Loeb. However, Loeb’s company stated that it has not agreed to provide any funds for Neumann’s bid yet.
WeWork’s Rise and Fall
Despite enabling WeWork to reach a peak valuation of $47 billion, Neumann was forced to leave the firm in 2019 amid worries about its profitability and “his eccentric behavior.” The firm was later acquired by Japanese investment bank Softbank (OTCMKTS:SFTBY), but struggled mightily in recent years amid the work-from-home phenomenon. As a result, it declared bankruptcy in November 2023.
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On the date of publication, Larry Ramer did not have (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.
