(Reuters) - British office space provider IWG Plc said on Monday it would sell its Japanese operations to TKP Corp for 320 million pounds as part of a strategic partnership.
The company behind the Regus and Spaces brand has been looking to close or refurbish locations in the UK and some other markets to revive its business, which has been hit by a weak property market in London and higher costs.
TKP will buy 130 flexible co-work centres operated by IWG in Japan and will also allow the Japanese company to exclusively use IWG’s Regus, Spaces and OpenOffice brands.
IWG Chief Executive Officer Mark Dixon will join TKP board as a non-executive member. The deal needs antitrust clearance in Japan and is expected to close in May, IWG said.
Last month, IWG had said it would revamp some locations including in the UK after reporting a dip in its full-year operating profit.
Credit Suisse upgraded IWG to “outperform” from “underperform” and raised its price target to 328 pence from 200 pence earlier on Monday, saying the company “begins the evolution towards a franchise model with consequent benefits.”
(This story corrects paragraph 6 to say ‘company’, not ‘deal’.)
Reporting by Shashwat Awasthi in Bengaluru; Editing by Bernard Orr and Gopakumar Warrier