WeWork Board Members Seek to Remove Adam Neumann as CEO

WeWork Board Members Seek to Remove Adam Neumann as CEO(Bloomberg) -- Some WeWork directors are planning to push Adam Neumann to step down as chief executive after the startup delayed its much-anticipated initial public offering, according to people familiar with the matter.Officials tied to SoftBank Group Corp., the company’s largest investor, want Neumann to step down as CEO of We Co., WeWork’s parent company, said the people, who asked not to be identified because discussions are ongoing. SoftBank founder Masayoshi Son is among those favoring Neumann’s removal, CNBC reported Sunday, citing sources it didn’t identify.Representatives for WeWork and SoftBank declined to comment.A board meeting could come as early as this week and they’ll consider a proposal for Neumann to stay on as We’s non-executive chairman. The company, which has raised more than $12 billion since its founding and never turned a profit, has said it intends to go public by year-end.Read more: WeWork, WeWait, WeWorry: What’s next for CEO Adam Neumann?Any coup might mirror the replacement of another enigmatic CEO before a public offering. Institutions including Benchmark Capital, one of WeWork’s investors, pushed out Uber Technologies’ Travis Kalanick before the ride sharing company went public.Still, even if some directors want to oust Neumann, it won’t be easy given the company’s governance structure. Based on the number of shares he controls, Neumann has the power to get rid of the entire board on his own, according to the prospectus.Talks with potential investors in recent weeks have pushed down expectations for WeWork’s planned IPO valuation to $15 billion or even lower, compared with a January fundraising round pegging the company’s value at $47 billion, Bloomberg and other publications have reported. Last week, WeWork pushed back its market debut. Among concerns that investors have voiced are Neumann’s controversial style and his control of the company.Banks that provided a $500 million credit line to Neumann are looking to revise the terms as his company’s struggle to go public casts doubt on the value of his collateral, people briefed on the discussions said Thursday. It’s not clear what changes they may seek, or what right they may have to make demands.The Wall Street Journal reported the activities of the WeWork board members earlier Sunday.(Updates with details about Neumann’s board control in fifth paragraph)To contact the reporters on this story: Michelle F. Davis in New York at mdavis194@bloomberg.net;Gillian Tan in New York at gtan129@bloomberg.net;Hailey Waller in New York at hwaller@bloomberg.netTo contact the editors responsible for this story: James Ludden at jludden@bloomberg.net, Steven Crabill, Matthew G. MillerFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

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