Worldwide: Membership club Soho House could become private after it “fundamentally rejects” a report released by GlassHouse Research, which claimed the business was worthless.
The report, released by GlassHouse Research last week, compared Soho House to the bankrupt coworking brand WeWork. A “broken business model and terrible accounting” were cited as reasons for why Soho House had “never [been] profitable in its 28-year history”.
The global expansion of Soho House was also said to have adverse effects on the member experience such as “overcrowding concerns” and a “decline in service quality”.
In December 2023, founder Nick Jones announced a freeze on new members in London, New York and Los Angeles. The company said it would only accept new members in locations where it has capacity.
Days after the report was published, Soho House issued a statement claiming its content had “factual inaccuracies, analytical errors, and false and misleading statements”. The company also said it had not been contacted prior to the report’s release.
Soho House suggested that it could become a private company in the autumn following an internal review. In addition to rejecting the report, it added that a special committee of the board has been formed to evaluate “certain strategic transactions” however there are “no assurances” that the review would result in transaction. American retail billionaire Ron Burkle is the controlling shareholder of Soho House.
The company went public in 2021 at a listing price of $14. Its share price has since fallen around 60 per cent.
In 2022, Jones stepped down from his role as CEO and promoted Andrew Carnie to lead the company. According to its website, the group operates 41 properties worldwide with four “coming soon”.
Source: boutiquehotelnews.com
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