(Reuters) -WeWork Inc on Tuesday said that Sandeep Mathrani would step down as the workspace provider's chief executive officer, effective May 26, while Sycamore Partners named him as a director to lead its real estate activity.
Mathrani was named WeWork CEO in 2020 and tasked with the company's turnaround following a botched IPO attempt and amid rising investor concerns over corporate governance standards.
WeWork went public in 2021 under his leadership, navigated the COVID-19 pandemic, cut costs, boosted revenue across business segments, and restructured and strengthened the balance sheet.
The company, which benefited from a pandemic-driven shift to flexible work outside traditional offices, has been impacted by mass layoffs across the tech sector over the past nine months.
WeWork in March struck deals to cut its debt by about $1.5 billion and extend the date of some maturities to preserve cash as it struggles to turn a quarterly profit since going public.
The company, which said Mathrani's resignation was not a result of any disagreement, named board member David Tolley as interim CEO.
Mathrani had succeeded co-CEOs Sebastian Gunningham and Artie Minson in 2020 and became the chairman of the company in March 2022 after Marcelo Claure vacated the role.
WeWork said lead independent director Daniel Hurwitz would serve as chairman of the board and head a special committee that will search for a permanent CEO.
WeWork shares have fallen about 76% so far this year, resulting in a market capitalization of $745.42 million, according to Refinitiv data. The company was valued at as much as $47 billion in 2019.
(Reporting by Ananya Mariam Rajesh in BengaluruEditing by Vinay Dwivedi)