IWG to take on WeWork with the sale of Spaces brand

The Regus brand's operator that doubles as a serviced-office company, IWG Plc, has brought on a specialist to sell its Spaces unit. The move is meant to help tempt a buyer that's willing to go against WeWork Cos.

The Switzerland-based company brought in broker Eastdil Secured LLC to market the unit that runs so-called design led flexible offices, the people said, asking not to be identified as the plan is private. IWG is pitching Spaces to potential buyers as an opportunity to acquire a global competitor to the richly valued WeWork, which is expanding rapidly, the people said.

Representatives for Eastdil and IWG declined to comment.

The move comes after a series of abortive bids for all of IWG in 2018 that led to a review of whether Spaces -– which specializes in providing more modern flexible and co-working office space than the Regus brand -- would be valued more highly as a separate business. If the review concluded that Spaces would be worth more outside IWG, then “we will consider what we do with it,” IWG Chief Executive Officer Mark Dixon told analysts in November.

IWG has a market value of about 2 billion pounds ($2.6 billion) compared with WeWork’s $47 billion valuation after the latest injection of capital from Japan’s Softbank Group Corp., despite the fact the New York-based company continues to post losses. The valuation of WeWork at technology-company levels has spurred interest from other major investors such as Blackstone Group LP, which bought a majority stake in U.K. operator The Office Group with plans to expand it internationally.

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