Anant Yardi, a low-profile software tycoon, will assume control of WeWork on Thursday. This transition follows a federal bankruptcy court's decision to hand over the co-working giant to its creditors.
What Happened: Yardi, an engineer who immigrated from India in 1968, has built a multibillion-dollar fortune over four decades through his company, Yardi Systems. The family-owned business specializes in property management software and generates nearly $3 billion in annual revenue.
Less than two years ago, Yardi invested over $200 million in WeWork through an anonymous vehicle. Recently, he committed an additional $337.5 million to counter an offer from former WeWork CEO Adam Neumann, who sought to regain control of the company, the Financial Times reported on Thursday.
Judge John Sherwood of the New Jersey district bankruptcy court is set to confirm a reorganization plan on Thursday. This plan will eliminate $4 billion in WeWork's existing loans and bonds, concluding a seven-month process that reduced the company's rent liabilities by $12 billion.
Yardi aims to expand WeWork's marketing to small businesses and incorporate hotel-like technologies, such as real-time bookings. Despite the challenges, Yardi expressed confidence in WeWork's future, stating, "If there were doubts, I think we would've been much more cautious."
Yardi Systems will now have a majority equity stake in the company upon emergence, while the company's current leadership team will remain in place and will welcome a new Board of Directors.
Why It Matters: The news comes after Neumann expressed interest in regaining control of WeWork in February as bankruptcy loomed. By April, Neumann had proposed a $600 million bid to regain control of the bankrupt company, showcasing his determination to steer WeWork once again.
Neumann's past leadership saw WeWork's valuation plummet from $47 billion to near collapse. Despite this, Neumann has publicly stated that he has learned from his mistakes and is eager to apply these lessons to new ventures.