WeWork continues to raise capital ahead of its planned listing. After this deal, the company will be valued at more than $20 billion.
CNBC has reported today, that SoftBank Group Corp is all set to sink in $3 billion into U.S. office-sharing startup WeWork as it seeks to expand its portfolio beyond just telecom and technological companies.
The Japanese giant, led by founder Masayashi Son, has made a bouquet of surprise strategic investments the most recent of which has been all-cash deal purchase of the Fortress Investment Group, an asset management company.
With the telecom market showing increasing signs of maturity, SoftBank aims to place itself with strategic cutting-edge tech investments: last year SoftBank disclosed its joint venture with Saudi Arabia revolving around the creation of a tech investment fund that has the potential to grow to $100 billion.
On fruition, this development is likely to make the group the world’s largest private equity investors.
As for WeWork, SoftBank is looking at sinking in at least $2 billion in the 1st phase of funding followed by $1 billion in the second round, said CNBC citing an anonymous source.
If the need arises, SoftBank could increase its investment during the second tranche to nearly $2 billion, for a total investment of approximately $4 billion, said CNBC. If the deal were to close, WeWork has the potential to be valued at more than $20 billion.
WeWork and SoftBank declined to comment.
As per two sources at WeWork’s investors, SoftBank has been holding multiple rounds of discussions revolving around its investments, without elaborating.
As for WeWork, its co-founder Miguel McKelvey has told reporters in Hong Kong that the company plans on expanding its footprint in Beijing this May.
WeWork provides shared workspaces for start-ups Hong Kong, Shanghai, Europe, and in the Americas.
Significantly, McKelvey disclosed that the company will continue to raise capital for its expansions ahead of its impending IPO. He however did not provide any timeline for its listing.