Temasek, Trustbridge 'eye majority stake in WeWork China'

BEIJING • Singapore's investment company Temasek and Shanghai-based private equity firm Trustbridge Partners have held talks with WeWork China over raising their stake in the China branch of the troubled co-working start-up to take majority ownership, three people familiar with the matter have told Reuters.

The plan, valuing WeWork China at around US$1 billion (S$1.35 billion), was submitted to WeWork's major stakeholder, Japanese tech conglomerate SoftBank Group, at the end of last year, said one of the people, who asked not to be identified.

WeWork owns 59 per cent of WeWork China, with the remainder held by other investors including SoftBank, Hony Capital and Trustbridge, according to the group's prospectus for its initial public offering.

The Chinese unit had raised US$500 million in July 2018 from various investors, including Temasek, Trustbridge, SoftBank and Chinese fund Hony Capital in a deal valuing the firm at about US$5 billion. That was the second round, with the first raising US$500 million in 2017.

A new deal giving Temasek and Trustbridge a majority stake would likely mean that WeWork China would go through a down round - a fall in valuation following a new investment if the proposal got passed. But it could also significantly ease the financial burden on WeWork and SoftBank.

REUTERS

A version of this article appeared in the print edition of The Straits Times on January 18, 2020, with the headline 'Temasek, Trustbridge 'eye majority stake in WeWork China''. Print Edition | Subscribe