WeWork won’t be going public anytime soon.
Continue Reading Below
The office-sharing company on Monday withdrew its S-1 Registration Statement.
“We have decided to postpone our IPO to focus on our core business, the fundamentals of which remain strong,” Co-CEOs Artie Minson and Sebastian Gunningham said in a press release.
“We are as committed as ever to serving our members, enterprise customers, landlord partners, employees and shareholders. We have every intention to operate WeWork as a public company and look forward to revisiting the public equity markets in the future.”
WeWork's credit rating was cut deeper into junk territory by S&P Global Ratings on Thursday due to concerns the company won't be able to meet its growth plans.
"The downgrade reflects heightened uncertainty around The We Company's ability to raise capital to support aggressive growth and the pressure this places on liquidity,” the rating agency's analysts said. “These uncertainties stem from the weak reception of The We Company's IPO, partly related to what we view as subpar governance practices.”
The downgrade came two days after Adam Neumann resigned as CEO amid concerns of the company's corporate governance structure. Neumann's shares were given 20 times the voting rights of ordinary shareholders.
Wall Street has previously raised concerns the company is burning through cash at an alarming rate. Sanford C. Bernstein & Co. analyst Chris Lane said in a recent note that The We Company had $2.5 billion of cash on its books at the end of June, and that it would run out of money during the second quarter if it continues its current cash burn rate of about $700 million per quarter.