Wework’s bond price has fallen sharply following the company’s decision to push back its troubled initial public offering (IPO).
The coworking company last night said it had postponed its float until the end of the year after a cold response from investors forced the firm to slash its valuation target in half.
Wework’s 7.875 per cent bond, which is due in May 2025, fell 5.5 points to 96.3 cents in early trading today, marking its lowest price since August. The bond’s yield rose to 8.71 per cent, according to data from MarketAxess.
It comes amid growing speculation over Wework’s future, with analysts raising concerns over its ability to turn a profit.
The firm, which has rebranded as the We Company, was set to launch its investor roadshow this week, but has since decided to shelve the float.
Wework was valued at $47bn (£38bn) after its latest fundraising round, but has reportedly been aiming to secure a valuation of just $20bn from its stock market debut.
The faltering confidence has reportedly taken its toll on Softbank, one of the firm’s largest investors, amid fears a disappointing IPO could impact its ability to raise $108bn for its second Vision Fund.
But Wework will be hoping it can use the delay to restore investor confidence in the business and get its float plans back on track.
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