Shared workspace provider Ucommune has filed to raise $100 million in an IPO, taking the next step in going public despite poor investor interest.
Currently, Ucommune has a portfolio of 197 centers across 42 cities in China. In the first nine months of 2019, the company lost $79 million, doubling its losses from the previous year according to its prospectus. While its revenue nearly tripled during that time, the firm said it had $23.79 million in cash at the end of September and a similar amount in money owed by its customers.
“I think the timing of the Ucommune deal near year-end will make it difficult,” said an analyst at a mid-sized brokerage that follows the sector. “I’m surprised that they’re coming to the market so soon after the WeWork disaster. I think developing an appetite for the deal may be challenging given the political environment and loss-making status of the business. It’ll be an uphill climb, I think.”
Some analysts have said that several Chinese companies are rushing to make IPOs now in order to open a channel of offshore capital as China makes it more difficult for domestic companies to move money elsewhere. In fact, almost a dozen Chinese companies have applied for New York IPOs since late September.