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Jonathan Price – CRE & Flex Expert
- The partnership will create “the world’s largest independent marketplace for flexible workspace” according to a press release from The Instant Group.
- IWG will invest £270 million to purchase shares of selling shareholders, while The Instant Group will infuse £50 million.
- The merger is expected to be completed by the end of 2023 through an IPO listing in either the UK or US.
Flexible workspace marketplace The Instant Group and office operator IWG have announced a merger of key digital assets in preparation for a more flexible future.
The partnership will create “the world’s largest independent marketplace for flexible workspace” according to a press release from The Instant Group.
As part of the merger, IWG will invest £270 million to purchase shares of selling shareholders, while The Instant Group will infuse £50 million.
This news comes as the office market begins to shift to a post-pandemic reality, which sees employers allowing workers to embrace hybrid and flexible workspace models and split their time between the office and their homes.
Combining IWG’s experience in the serviced office industry, its ownership of Regus and Spaces, and The Instant Group’s massive flexible office network, the business aims to give users the ability to access office spaces of any shape or size.
This suggests that agility and flexibility have been solidified as key components for the future of work.
“Our clients have been asking us to expand the reach and capabilities of our business to help solve the challenges of hybrid working,” said Tim Rodber, CEO at The Instant Group. “Similarly, our operator and landlord partners have been asking for a better route to market for their workspace products and an ability to monetise their excess capacity.”
The Instant Group predicts that the flexible office industry will take up over 12.5% of the market in the next three years, and by tripling its digital marketplace through this merger, the company can successfully address the growing demand for such workspaces.
Through the merger, IWG predicts that its business will double its earnings before interest, taxes, depreciation, and amortization (EBITDA) to around £31 million.
Last year, IWG posted a loss before tax of £259.4 million, compared to a £613.3 million loss in 2020.
The merger is expected to be completed by the end of 2023 through an IPO listing in either the UK or US.
When finalized, The Instant Group’s key executive management will take over operating the business.
The Instant Group predicts that its workforce will grow from 300 employees to 500 following the merger.
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“I am delighted with the merger of IWG’s digital assets with The Instant Group,” said Mark Dixon, CEO of IWG. “This creates a clear path for value creation and will harness the next generation of digital-native workers and the huge market potential of flexible working, building long-term and future-proof growth as the world’s leading supplier of flexible workspace solutions.”
