Some WeWork directors are planning to push Adam Neumann to step down as chief executive after the start-up delayed its much-anticipated initial public offering, people familiar with the matter said.
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 on Sunday, citing sources it did not identify.
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Representatives for WeWork and Softbank declined to comment.
A board meeting could come as early as this week and they will consider a proposal for Neumann to stay on as We’s non-executive chairman.
The company, which has raised more than US$12 billion since its founding and never turned a profit, has said it intends to go public by the end of the year.
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 Inc’s Travis Kalanick before the ride-sharing company went public.
Still, even if some directors want to oust Neumann, it would not 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 US$15 billion or even lower, compared with a January fundraising round pegging the company’s value at US$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 US$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 on Thursday.
It is not clear what changes they might seek, or what right they may have to make demands.
The Wall Street Journal reported the activities of the WeWork board members earlier on Sunday.
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