NEW YORK - WeWork co-founder Adam Neumann agreed on Tuesday to resign as chief executive and give up majority voting control, after SoftBank Group Corp and other shareholders turned on him over a plunge in the US office-sharing start-up's estimated valuation.
SoftBank invested in We Company at a US$47 billion valuation in January. But investor skepticism led to it earlier this month considering a potential IPO valuation of as low as US$10 billion, Reuters reported. Artie Minson, currently chief financial officer of WeWork parent We Company, and Sebastian Gunningham, a vice chairman for the New York-based start-up, will become co-chief executives, the company said. Neumann will stay on the board as non-executive chairman, the company added.
"While we anticipate difficult decisions ahead, each decision will be made with rigorous analysis, always bearing in mind the company's long-term interests and health," Minson and Gunningham wrote in an internal company memo seen by Reuters. While his investors were willing to entertain his eccentricities over the decade he led WeWork since its founding in 2010, his free-whiling ways and party-heavy lifestyle came into focus once he failed to get the company's IPO underway.
Neumann had also entered several transactions with We Company, making the company a tenant in some of his properties and charging it rent. He has also secured a US$500 million credit line from banks using company stock as collateral.
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