IWG Mulls Spinning Off Digital & Tech Assets

IWG Mulls Spinning Off Digital & Tech Assets

GLOBAL – Flexible office space provider IWG is considering to separate its digital and technology businesses from its property assets, reported Reuters on Tuesday evening (2 October, SGT).

The company, which owns the Regus and Spaces flexible workspace brands, revealed that it has begun evaluating the strategic and commercial merits of such a move and it intends to provide updates by H1 2022.

“The potential to more broadly leverage the intellectual property of the group, together with the ownership structure of the property portfolio, is the subject of further review,” stated IWG in a bourse filing.

In September 2021, Sky News reported that IWG was exploring a multi-billion-pound separation of its digital and technology businesses from its property assets. The report also said that the flexible office space provider, which has outlets in over 3,300 locations across 110 countries, was looking to list its workspace booking app Worka in the US.

Peel Hunt analyst, Andrew Shepherd-Barron, said the rationale of IWG’s move is to unlock any hidden value, but it’s still in the early days.

“IWG is always keen on hidden value wherever possible and has done it in the past through the sale of master franchise agreements. But it is not yet obvious there is hidden value here to be released,” he noted.

Apart from its brick-and-mortar workspace, IWG owns a number of digital businesses that lets clients find and book office spaces online, like Meetingo and Worka.

In Q3 2021, the flexible office space provider’s revenue declined by 0.3 percent to £550.8 million (US$752 million), as an increase in COVID-19 cases around the globe derailed customers’ plans to bring back staff to the office.

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