Ah, WeWork. The gift that keeps on giving.
This week, it was reported that the coworking firm is considering the drastic move of cutting its $47 billion valuation in half before its planned IPO. WeWork's roadshow is reportedly set to kick off next week, but it remains unclear if that'll happen. Some investors that I spoke to said they're still concerned about opacity around WeWork's financials and lack of disclosures. They think ultimately the deal will get done - it just may not be at the company's ideal price.
Meanwhile, even seasoned asset managers are confused about WeWork's valuation, reports BI's Bradley Saacks.
Fidelity, which has exposure to WeWork through its massive Contrafund, slashed the fund's valuation on WeWork shares between the end of last year and the middle of this summer, according to a regulatory filing. The mutual-fund giant once valued the company significantly higher than its peers but has cut the valuation of WeWork shares in the Contrafund by roughly a third.
Other funds, like T. Rowe Price's Diversified Mid-Cap Growth Fund, have hiked the value of their WeWork stakes.
There does seem to be one thing that all the funds can agree on: WeWork is listed in the real-estate section of each funds' reports. It's a far cry from the high growth tech company that WeWork is trying to position itself as to prospective investors.
Here's some more of our WeWork coverage from this past week:
- Real-estate billionaire Sam Zell just bashed WeWork: 'Every single company in this space has gone broke'
- The CEO of coworking startup Convene is worried bad press around WeWork's model could taint the entire flex-office industry
- WeWork says it has a $3 trillion market opportunity and has signed up only 0.2% of its potential customers. Here's why real-estate experts say those numbers don't add up.
If you were away all summer...welcome back!
Olivia