Temasek, Trustbridge in talks to take majority stake in WeWork China: sources

Singapore state-owned Temasek Holdings and Shanghai-based private equity firm Trustbridge Partners have held talks with WeWork to take majority ownership of the co-working company’s China unit, Reuters reported, citing people familiar with the matter.

The deal could value WeWork China at US$1 billion.

Photo credit: Eloise Ambursley

According to the people, Temasek and Trustbridge want to take a combined majority ownership in WeWork China by buying more shares.

One of the people said that SoftBank Group, a WeWork major shareholder, received the proposal at the end of 2019. The discussions, however, are still at an early stage, and a deal has not been settled.

If the plan materializes, WeWork China could see a fall in valuation after the investment, but it would also help ease WeWork and SoftBank’s financial burden, according to Reuters.

Late last year, it was reported that the US co-working operator was in talks to sell off its China business, a deal that could see local rival Kr Space as the acquirer. WeWork, however, denied the claims.

WeWork China saw US$99.5 million in revenue in 2018, according to its prospectus for its initial public offering. It is reportedly eyeing US$500 million in revenues for 2020.

The company currently operates offices in 10 cities across mainland China, according to its website, covering Beijing, Shanghai, Shenzhen, Guangzhou, and Wuhan, among others. According to Reuters, internal company data shows that occupancy rates for WeWork China were around 60% by September last year.