In a startling development unforeseen by financial forecasters in Asia this week, the franchise WeWork in India has announced that their loan talks with national ICICI Bank of India for a one-hundred million dollar reprieve have stalled, and are not expected to be revived. The financial reverse is being blamed on the company’s tepid IPO launch last year. WeWork’s chief financial counsel, Jitu Virwani, told reporters earlier this week that the company has leads on other investors who should be able to make up for the cash shortfall.
The company’s original CEO and founder, Adam Neumann, was let go by its board of directors last year in a desperate ploy to shore up their sagging stock offerings, but it was too little too late. The company is now seen as losing its grip on the burgeoning tech supply and office space market that has proven so profitable for many other startups in the subcontinent.
WeWork continues to do well in countries where it operates as an independent entity, such as Japan. But the company’s decision to offer its brand and personnel in India as a franchise option instead of running branch offices itself is now seen as a strategic blunder that may force the company into borrowing funds at an exorbitant rate.