WeWork may raise Rs 1,400 crore, shrugs off global woes

The company clarified that the IPO debacle in the US had no bearing on the Indian entity.

Published: 12th October 2019 08:05 AM  |   Last Updated: 12th October 2019 08:05 AM   |  A+A-

WeWork India

WeWork India

By Express News Service

Co-working start-up WeWork might have landed itself in a fair load of trouble globally, but its Indian wing doesn’t expect any impact from its international troubles. In fact, WeWork India - which franchise is owned and operated by real estate major Embassy Group - is planning to raise as much as Rs 1,400 crore or USD 200 million by the end of the year to expand operations.

Speaking to reporters, WeWork India’s business head Karan Virwani and Embassy Group chairman and managing director Jitu Virwani both pointed out that despite WeWork’s deferment of its planned initial public offering (IPO) last month and the ousting of CEO and co-founder Adam Neumann, the India franchise would go ahead with its expansion as planned.

“We still believe in the WeWork brand and the India business is really growing well. Embassy Group is bullish about the co-working sector and we continue to expand,” said Karan Virwani. "Adam Neumann or no Adam Neumann, our business is here to stay," added Jitu Virwani.

The Bengaluru-based Embassy Group had partnered theUS-based co-working start-up WeWork in 2016. WeWork India is an independent entity with the right to execute its business in India and it pays a management fee to the American firm.

According to sources, the IPO deferment had resulted in a breakdown in talks where WeWork India had been planning to raise around USD 100 million. However, the company is now confident of raising the looked for USD 200 million by the year-end, from a clutch of investors that company officials say have already expressed interest. The company has already invested Rs 1,300 crore in the India business, including Rs 1,000 crore as equity.

The funds so raised will go into WeWork India’s expansion plans. The company currently has 26 operational coworking centres with a seating capacity of 46,000. There are nine centres in Bengaluru, 10 in Mumbai, six in Gurugram and one in Pune, with seats available at between Rs 5,000-40,000 per desk per month.

The company is now targeting an increase, with a goal of hitting 1,00,000 seats by end of the next year. WeWork India will also soon enter the Noida and Hyderabad office markets and has already taken on lease over 3 lakh sq ft office space in Noida to build three co-working centres. The company also aims to achieve profitability at the centre level before the next 12 months.

Funds raised will be used for expansion

According to sources, the IPO deferment had resulted in a breakdown in talks where WeWork India had been planning to raise around USD 100 million. However, the company is now confident of raising the looked for USD 200 million by the year-end, from a clutch of investors that company officials say have already expressed interes to fuel its expansion plans. The company currently has 26 operational co-working centres across the country

Stay up to date on all the latest Business news with The New Indian Express App. Download now
(Get the news that matters from New Indian Express on WhatsApp. Click this link and hit 'Click to Subscribe'. Follow the instructions after that.)

Comments

Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the newindianexpress.com editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on newindianexpress.com are those of the comment writers alone. They do not represent the views or opinions of newindianexpress.com or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. newindianexpress.com reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp