WeWork India raises Rs 500 crore by way of rights difficulty, CFO Information, ETCFO
Versatile workspace supplier WeWork India has raised Rs 500 crore by way of a rights difficulty.
The funds will probably be used to repay its debt and scale back price of capital, the corporate mentioned in a press release on Monday.
“With the current profitable completion of our rights difficulty, we’re on the trail to being debt-free. This underscores the belief and confidence our traders/shareholders have in our imaginative and prescient and technique in India,” mentioned Karan Virwani, managing director and CEO, WeWork India.
A rights difficulty is a proposal by an organization to its current shareholders to purchase further shares, normally at a reduced value, to lift funds.
This fundraise follows the collapse of WeWork Inc’s plan to promote its 27% stake within the Indian unit and exit the nation, permitted by the Competitors Fee of India (CCI), resulting from a valuation mismatch, as reported by ET on September 27, 2024.
WeWork entered India in 2017 by a partnership with Embassy Group. At present, Embassy holds a 73% stake within the Indian unit, whereas WeWork Inc owns the remaining 27%.
The deal, estimated at round Rs 1,200 crore, additionally included Bengaluru-based property developer Embassy Group divesting a 13% stake to a consortium of traders, together with the Enam Group household workplace, A91 Companions and CaratLane founder Mithun Sacheti.
Additionally, Virwani was in talks with 360 One, previously often known as IIFL, to accumulate a part of the 27% stake held by WeWork Inc within the Indian unit, in line with the ET report.
WeWork supplies versatile workplace areas and custom-built options for companies. Its income streams embrace memberships that supply entry to workplace areas, shared web connectivity and different facilities, in addition to ancillary providers comparable to convention room leases, printing and parking charges.
Since its inception, WeWork India has expanded to 63 operational centres throughout cities together with Chennai, New Delhi, Gurgaon, Noida, Mumbai, Bengaluru, Pune and Hyderabad, with over 100,000 desks.
The coworking sector in India has seen important progress over the previous yr, in distinction to many different world markets. Rivals like Awfis, backed by Peak XV Companions, went public in Might final yr with a Rs 600 crore preliminary public providing (IPO), which was subscribed 108 occasions by traders.
Different rivals within the sector embrace TableSpace, Indiqube, CoWorks, 91Springboard and Bhive.
Bengaluru-based Indiqube has additionally filed a draft purple herring prospectus (DRHP) for its Rs 850-crore IPO on December 25.
WeWork India recorded a 22% rise in income to Rs 1,737.2 crore for the fiscal yr ended March 2024, in line with information from Tracxn. The corporate’s losses narrowed barely, lowering from Rs 148.8 crore in FY23 to Rs 132.5 crore in FY24.
