Brookfield Asset Management and Canadian private equity firm Onex Corp have backed out of talks to buy serviced office provider IWG, sending shares in the company down by nearly 16%.
In December 2017 it was announced that, in a joint venture, the companies had made a proposal for IWG in the region of $3.7 billion. When a formal bid did not materialise, the original 20th Jan deadline was extended to 2nd Feb; however, IWG has now confirmed that negotiations with Brookfield and Onex regarding their proposed bid have broken down and will continue no further.
The last few months have not been easy on the office giant. Declining business in Q3 2017 led to the issue of a profit warning that caused company share prices to drop by nearly 40%, and although profits stabilised somewhat in Q4 2017, this latest blow has caused share prices to fall once again, decreasing the value of the business by approximately £550M ($800M).
Nevertheless, a statement made by IWG has stated; “The board remains highly confident in the prospects of IWG and believes that IWG continues to have an exciting future as an independent company.”
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