Wework IPO: Firm cuts founder’s supervoting power to save float
Wework is set to slash the supervoting power of its co-founder to assuage fears of investors as it tries to save the company’s initial public offering (IPO).
The firm will also appoint a lead independent director by the end of the year as well as cut Neumann’s voting power from 20 votes per share to 10 votes.
Read more: Softbank urges Wework to halt float amid investor doubts
In a filing with the Securities & Exchange Commission (SEC) Wework’s parent firm, The We Company, said: “Corporate governance is important to our company. We are making a number of changes to our proposed governance structure in response to market feedback.”
The IPO has already had to offer a cut-price deal valuing the property giant at $15bn (£12bn), far less than half the $47bn it was worth when Softbank proposed an additional $2bn investment in the group earlier this year.
And there are fears that investors will not take up on the loss-making firm’s new valuation either.
Consequently the firm has made a series of changes to its governance.
Those include ruling out any member of Neumann’s family sitting on the board.
“Any chief executive officer who succeeds Adam will be selected by our board of directors, acting as a group,” Wework added.
“We will not rely on a succession committee. Our board has the ability to remove our chief executive officer.”
It also removed the ability for Neumann’s wife, Rebekah, to choose his successor in the event of his death.
Wework plans to list on the Nasdaq stock market under the symbol ‘WE’, it also confirmed today.
However, the firm’s current valuation is less than a quarter of the $65bn that Goldman Sachs had once touted it could be worth.
Read more: Debate: With its valuation in question, is Wework’s IPO really a good idea?
Concerns were heightened by the departure of chief communications office Jennifer Skyler earlier this week. She left to join American Express.
Investor are more concerned by the valuation and business model than the company’s corporate governance, the FT reported, and Neumann has regularly been in touch with Softbank chief executive Masayoshi Son to find a solution.
Wework and Softbank declined to comment.