WeWork India, a franchisee of the New York headquartered co-working space provider, will raise $100 million from its global partner to support its growth plans.
The company’s Indian operation is owned and run by real estate firm Embassy Group.
The investment is half of the $200 million figure suggested by media reports in October 2019. The Indian franchisee was initially in talks with ICICI to raise $100 million, a deal that hit a roadblock as WeWork’s proposed IPO broke down over concerns on valuation, pushed by its largest investor, SoftBank.
The capital will also bolster WeWork’s commitment to the Indian market, according to a statement.
“The flexible workspace industry in India and around the world is facing its biggest challenge yet. In that, we see a new opportunity that suits our members’ evolving needs,” Karan Virwani, CEO of WeWork India said.
WeWork India was initially planning to raise $200 million by the end of 2019 in order to double its capacity across six Indian cities by 2020. The company has managed to increase the number of desks from 45,000 in October 2019 to 60,000 now across 34 locations.
“WeWork India’s financial performance has shown consistent growth, and with the fundamentals in place at a building level backed by the expertise of the Embassy Group, we believe the WeWork India business has the ability to be our growth vehicle and provide our members an exceptional experience,” Sandeep Mathrani, CEO of WeWork said.
Mathrani took over as the CEO of the global business in February, replacing founder Adam Neumann who was ousted in September 2019.
Bengaluru based Embassy Group had partnered with WeWork to execute the brand’s business in India and holds 100% rights over the business. In October 2019, Embassy Group chairman Jitu Virwani had said that the firm was willing to back the India business with its own capital.
Embassy Group is backed by private equity investment management firm Blackstone.