U.S. co-working space provider WeWork Cos said on Thursday it would buy China-based rival Naked Hub to boost its footprint in the world’s second largest economy.
WeWork, which opened its first China location in Shanghai in 2016, said the combined firm aimed to grow to serve 1 million members in Greater China by the end of 2021.
New York-based WeWork, valued at about $17 billion, currently serves more than 10,000 members in Beijing, Shanghai and Hong Kong.
Bloomberg earlier reported, citing sources, that WeWork would pay about $400 million for the Shanghai-based firm. Reuters also reported the deal earlier on Thursday citing sources.
WeWork did not provide financial details of the deal, while Naked Hub did not respond to requests for comment about the size of the transaction.
Naked Hub has around 50 opened and planned locations across mainland China, Hong Kong and Vietnam. Its chief executive told Reuters in January the firm was looking to expand around Asia and have 200 locations by 2020.
WeWork, backed by Japan’s SoftBank Group Corp (9984.T), is one of the world’s hottest start-ups. It received $4.4 billion in investments from the Japanese firm and its technology fund last year.
The U.S. firm leases office space and rents it out to individuals and small companies. It said in February it expected to double its membership to 400,000 people this year and would open 200 new office spaces around the world.