The WeWork executive chairman says it is “completely wrong” that CEO Adam Neumann ran away with a $ 1.7 billion payout after the company’s IPO failed.
Marcelo Claure challenged Monday that Neumann, who founded WeWork in 2010, received a $ 1.7 billion payout to give up control of his business.
“To say he ran away with more than a billion dollars is completely incorrect,” said Claure, who is also a top SoftBank director, CNBC.
SoftBank said in October that it would launch a $ 9.5 billion WeWork bailout after canceling the initial public offering of the startup due to investor concerns about corporate governance.
Chairman Marcelo Claure challenged Monday that Adam Neumann, who founded WeWork in 2010, received a $ 1.7 billion payout to give up control of his business
The rescue included a $ 3 billion bid for WeWork shares, including up to $ 970 million in the hands of Neumann.
At the time, it was reported that Neumann would receive the $ 1.7 billion payout to give up his check.
The payout caused outrage at WeWork employees because layoffs and cuts were made.
Claure said that a tender is now under way, in which Neumann has the right to participate with shareholders.
Neumann only receives as much money as he decides to sell his shares.
“He is a major shareholder in the company, he was a founder and while we are tendering to buy shares from other shareholders, he gets the same opportunity as any other shareholder,” Claure said.
He added that while he and Neumann rarely talk, the former boss often calls to share his thoughts about the company he founded.
“I think he’s very excited that the company is moving from high growth to a more disciplined company with responsibility and more mature leadership,” said Claure.
SoftBank said it would launch a $ 9.5 billion bailout from WeWork in October, including a $ 3 billion bid for WeWork shares, including up to $ 970 million owned by Neumann
He repeated that WeWork wants to be profitable in 2021.
Claure, who took over as chairman at the end of last year, tries to reverse WeWork after Neumann was dismissed as CEO and was rescued by SoftBank after a failed public offering.
It is after the office-sharing office last week revealed that real estate veteran Sandeep Mathrani would take over the company’s new CEO.
Mathrani, who will take over co-CEOs Sebastian Gunningham and Artie Minson, will report directly to Claure.
Both Gunningham and Minson will stay with the company for at least a transitional period to ensure a smooth entry process.
WeWork revealed last week that veteran Sandeep Mathrani from the real estate sector would take over the company’s new CEO
Mathrani is the former director of the Brookfield Properties retail group, which is located behind the largest shopping centers in the country.
WeWork began its search for a new CEO in November after the departure of Neumann, who was criticized for his erratic management style.
WeWork’s IPO was suspended last year and the company recorded a hefty dive in valuation, to less than $ 8 billion from $ 47 million.
On the brink of the financial collapse, WeWork was saved by investor Softbank.
Softbank has drawn up a five-year business plan to get the company back on track and to be cash-flow positive by 2021.
After the bomb bailout, Claure played a central role in leading the company and looking for a new chief executive.
At one point he considered John Legere, Chief Executive of T-Mobile US Inc.
Since then, the company has largely stopped signing leases and executives have considered withdrawing from some locations, such as China.
According to the WeWork model, the company rents office spaces to startups and freelancers by investing in real estate in expensive markets and refurbishing the spaces.
The company recovers money in the long term by having companies and individuals pay rent or membership fees.