WeWork announced Friday it plans to enter public markets through a merger transaction that raises $1.3 billion for the office-sharing firm.
The move comes two years after the former high-flying office-sharing company went into a spectacular tailspin that led to the cancelling of a planned public share offering and a bailout by Japanese investment firm SoftBank.
The transaction with BowX Acquisition Corp. is the latest instance in which a prominent company eschews a traditional initial public offering in favor of combining with an entity like BowX that has been specifically established by investors for such a merger.
The move of merging with a so-called "special purpose acquisition company" or SPAC follows a recent trend that streamlines the process of a public listing.
WeWork was given an enterprise value of $9 billion in the transaction.
Once a dazzling "unicorn" valued at $47 billion, WeWork began to unravel as the firm lost cash and canceled a planned 2019 share offering, with the ex-CEO pushed out -- albeit with a generous package.
WeWork executives said the company is poised to thrive in the post-pandemic economy.
"SoftBank has always seen the potential in WeWork's core business to disrupt the commercial real estate industry and reimagine the workplace. Today, we take another step towards making that vision a reality," said Marcelo Claure, the SoftBank CEO and executive chairman of WeWork.
"The pandemic has fundamentally changed the way we work, and WeWork is incredibly well positioned to springboard into a future propelled by digital technology and a new appreciation of the value of flexible workspace."
The transaction will be funded with BowX's $483 million of cash and $800 million from other investors led by Insight Partners, Starwood Capital Group, Fidelity Management & Research Company, Centaurus Capital and BlackRock.