WeWork intends to hire JPMorgan Chase and Goldman Sachs to lead the IPO

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According to Bloomberg News, WeWork will appoint JPMorgan Chase and Goldman Sachs as its chief underwriters of IPOs next month and will increase the fees paid to banks.
According to people familiar with the situation, JPMorgan Chase is expected to get the lead left position of underwriters. However, the terms and hierarchies concerning all investment banks have not yet been formally established and may change at any time.
WeWork’s IPO target is about $3.5 billion and is expected to become the second largest new stock offering in the year. The company’s IPO fee pool has been rising in recent days as it plans to raise $6 billion in debt after its successful IPO. This unusual pairing of transactions aims to diversify the sources of funding for WeWork’s global expansion.
Earlier this week, people familiar with the matter revealed that WeWork was prepared to take 2.5% to 3% of its IPO financing to cover underwriting costs. According to people familiar with the situation, the proportion of people still negotiating has risen to 3.5%, but the situation is also changing.
Spokesmen for WeWork, JPMorgan Chase and Goldman Sachs declined to comment.
New York-based WeWork provides office space for businesses and freelancers. They have been looking for ways to grow, possibly investing in a wide range of businesses and real estate. For investment banks working with WeWork, boosting billions of dollars in additional financing may be more profitable than simply dealing with their stock sales, people familiar with the matter said.
People familiar with the situation said the company was trying to raise $2 billion through letters of credit loans and $4 billion through delayed withdrawal loans. Only by raising at least $3 billion in initial public offerings can banks honour their promises. The lender will receive an advance fee equivalent to about 3% of its final commitment.
Uber’s May IPO amounted to $8.1 billion, making it the world’s largest IPO in 2009. Next came Avantor, which went public this month, with $2.9 billion in financing. (I. Shu)