FILE PHOTO: The WeWork logo is displayed outside of a co-working space in New YorkReuters
WeWork has drawn the attention of the US Securities and Exchange Commission after its failed attempt to go public, Bloomberg's Matt Robinson, Robert Schmidt, and Ellen Huet first reported Friday.
The office-sharing startup is facing federal scrutiny of its business and its disclosures to investors in the weeks leading up to its attempted IPO, Bloomberg reported, citing people familiar with the matter.
Bloomberg's report that the SEC inquiry is preliminary, and that it may not lead to any allegations of wrongdoing. It also notes the SEC has been known to "kick the tires" of embattled companies in the public eye.
WeWork cancelled its planned IPO in late September shortly after ousting its chief executive, Adam Neumann, amid concerns from investors that the business wasn't as profitable as it initially claimed and that Neumann's controversial leadership style was putting the company's future in peril.
WeWork was once privately valued at $47 billion, but that number has since fallen to a fraction of that and the company negotiated a rescue deal with SoftBank that gave the investor control.
According to Bloomberg, WeWork has retained Wall Street lawyer and former SEC enforcer Andrew Ceresney as it faces scrutiny from the SEC.
SoftBank has installed Marcelo Claure as WeWork's new chairman, who will oversee the company along with its two interim CEOs, Sebastian Gunningham and Artie Minson, who replaced Neumann. The company is reportedly seeking a high-profile permanent CEO. Among the candidates being considered is T-Mobile CEO John Legere, according to CNBC, which also reported that Legere is not the leading candidate.
A WeWork spokesperson declined to comment. A spokesperson for the SEC declined to comment.
Read the full report over at Bloomberg.
This is a developing story. Check back for updates.
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November 16, 2019 at 01:01AM
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WeWork is reportedly drawing scrutiny from the SEC after its failed attempt to go public - Business Insider
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