The Caisse de dépôt et placement is abandoning the real estate partnership it created in 2019 with WeWork, in which it was to invest up to $ 1.3 billion.
“This partnership is, I would tell you, ancient history. It’s put behind us, ”confided this week to Journal the President and Chief Executive Officer of the Caisse, Charles Emond.
“I think we’ve moved on to something else,” he added. The society [WeWork] it itself has passed through its own zone of turbulence. “
Approximately US $ 85 million invested
In May 2019, WeWork’s parent company, The We Company, and La Caisse announced the creation of the ARK real estate “platform”. Through this entity, the two partners were to jointly invest in real estate projects where WeWork played a driving role, mainly in the United States.
Listen to Charles Émond’s interview on the show Mind your own business on QUB radio:
Ivanhoé Cambridge, the Caisse’s real estate subsidiary, made only two investments with a total value of approximately US $ 85 million (approximately CA $ 108 million) under the partnership: one in Austin, Texas , and the other in San Francisco.
Recall that a few months after the creation of ARK, WeWork missed its IPO, investors worried about the fragility of the business model of the shared workspace rental company. This spectacular failure led to the departure of WeWork founder Adam Neumann.
Japanese company SoftBank, a major WeWork shareholder, announced on Friday that it had reached an agreement whereby Mr. Neumann will receive, according to media reports, nearly US $ 500 million (C $ 637 million) for his stake in the ‘business.
In the interview he gave to Journal, Charles Emond also assured that he was not disappointed that the Caisse did not succeed in completely withdrawing from the fiasco of Ciment McInnis.
Last fall, Votorantim bought the Gaspé cement plant as part of a transaction where the Caisse will become a shareholder in the Canadian activities of the Brazilian giant.
“This is probably the best scenario we could imagine,” said Emond.
Listen to Yves Daoust and Michel Girard’s analysis on QUB radio:
“We take an asset that was alone, which had to fight in the market against an oligopoly, and we put it in a joint venture with [Votorantim], he clarified. So instead of having a large stake in an asset that is losing money, you have 17% of a joint venture that has four or five extremely profitable assets. “
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