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New York Stock Exchange delists WeWork warrants

Move comes as co-working giant pursues reverse stock split

NYSE Suspends, Delists WeWork Warrants
WeWork interim CEO David Tolley (Getty, WeWork; Illustration by The Real Deal)

The New York Stock Exchange suspended the trading of WeWork warrants as the co-working giant tries to stave off the delisting of its common shares.

WeWork cited “abnormally low” trading prices in a Tuesday announcement on the NYSE’s decision reported by Reuters. The stock exchange will also initiate proceedings to delist the warrants from its exchange.

The company said it does not plan to appeal the NYSE’s decision on the warrants, which are contracts that give holders the option to buy WeWork shares in the future, potentially diluting the value of existing shares if the flex space company issues new shares. Common shares are still being traded, but the suspension of warrants may be a significant harbinger of what’s to come.

WeWork is set to launch next month a 1-for-40 reverse stock split on the exchange in an effort to elevate the company’s bottoming stock price and avoid being delisted by the NYSE. Every 40 company shares will be consolidated into a single share at the end of day on Sept. 1.

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Since going public in Oct. 2021, company stock has collapsed by 99 percent, wiping out $9 billion in market value. Shares were down slightly to 13 cents on Tuesday.

WeWork told investors this month there was “substantial doubt” about its continued operations. The company cited membership losses and a lack of cash, saying in the next 12 months it would prioritize cutting expenses, renegotiating leases, growing membership and raising capital.

The company has lost $11.4 billion since 2020. It’s is also in the midst of a leadership upheaval following chief executive officer Sandeep Mathrani’s departure as CEO this year; charismatic founder Adam Neumann was ousted after a botched first attempt to take WeWork public.

WeWork is feeling the strongest pinch from its struggles, but other real estate companies and individual investors — including Shaquille O’Neal — are feeling pain from the market value collapse as well.

— Holden Walter-Warner

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CoworkingOffice MarketStock MarketWeWork