WeWork’s controlling stake in Indian market, is the face of workspace changing?
In order to secure its position in the Indian market, New York-based WeWork is expecting to buy a controlling stake in its Indian joint venture.
The workspace provider is holding negotiations to tap the Indian market with a major stake. Currently, Jitu Virwani of Embassy Group (leading office space) is managing the operations in this part of the world. The company expects the stake to reach up to 51 percent. It aims at capturing its business ownership before valuations escalate too high.
Leading office space provider, Embassy, has built over 35,000 desks across 17 locations for WeWork India. It is planning to expand its franchise to 90,000 desks until the end of December. The expansion target is set to complete by 2021.
WeWork is in talking terms with Virwani and team, and also with the founder Adam Neumann to hold a meeting in the upcoming third week. The agenda behind the meeting is to discuss the firm’s $1bn dollar to take control over India’s Joint venture.
WeWork’s prompt decision to enter into the deal was fueled by its objective to take control before the licensing deal ends in 2021. With India emerging as one of the biggest workspace places, the company wants to firm its grasp over the prospective market as soon as possible.
If WeWork proliferates according to its expansion objectives, it will be capitalizing on estimated revenue of 1,500 crores. Some of the recent investment deals in the sector has happened 8-15 times gross billings, said sources.
“WeWork’s exponential growth across three major cities in the last 18 months has proven that they are still scratching the surface. There are only a few quality players like Cowrks and Awfis who can really give them any competition. It is less crowded on the top” JLL India executive director Juggy Marwaha said.
Started in 2010 by two entrepreneurs- Adam Neumann, and Miguel Mckelvey, the company is presently operating in 96 cities and is spread over 539 office locations.
What drives the company towards its $45 billion worth is the combination of digital and aesthetic factors it leverages to build its workspaces, ultimately leading to productivity, innovation, and networking.