On Monday, office-sharing company WeWork filed for Chapter 11 bankruptcy protection in federal court on Monday. In 2019, its value was $47 billion when it tried and still failed to go public, despite being led by Masayoshi Son’s SoftBank.
In August, the company disclosed a filing that bankruptcy could be a big concern. Here, WeWork warned US regulators that it is worried about its own survival. WeWork also cited its financial losses, drop in memberships, and cash needs, as it filed bankruptcy with the Security and Exchange Commission.
The company also said that it had entered into an agreement with a majority of secured noteholders. WeWork also stated that its intention was to trim non-operational leases.
WeWork’s bankruptcy filing is limited only to its locations in the United States and Canada. According to the bankruptcy filing, the company’s reported liabilities ranged from $10 billion to $50 billion.
David Tolley, the CEO of WeWork, said in a press release –
“I am deeply grateful for the support of our financial stakeholders as we work together to strengthen our capital structure and expedite this process through the Restructuring Support Agreement. […] We remain committed to investing in our products, services, and world-class team of employees to support our community.”
In the recent history of the United States, the company suffered one of the spectacular collapses in the past few years. In 2019 itself, the company’s value was $47 billion. Since that year, the company tried to go public but failed many times. The coming of the pandemic further enhanced this pain, as many companies abruptly ended their leases. The economic slump following the pandemic led to more problems.
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