WeWork may go bankrupt by November
WeWork ‘s downward spiral continues. The company reported a loss of $900 million for the first half of 2019 in regulatory documents ahead of its planned initial public offering which the company later canceled.
WeWork CEO Adam Neumann also stepped down in light of the given financial crunch situation that the company was in.
Initially, WeWork was in talks with its largest shareholder, SoftBank, to secure a substantial investment in order for the company to stay afloat. But, now it seems that the company may go bankrupt by next month if funds are not negotiated with SoftBank.
The office-sharing company is trying to reach terms on a financing package to ease the cash crunch, reports Bloomberg Quint. Analysts had previously estimated that the company would run out of money by the middle of next year.
Further, the company’s bond prices climbed from record lows amid reports of the financing talks. Its senior unsecured notes due 2025 were up 1.125 cents on the dollar to around 83.5 on Friday at 9:40 a.m. in New York, after dropping to as low as 81.25 cents on Thursday, according to Trace bond trading data.
JPMorgan Chase & Co. is leading the financing talks. According to the Financial Times, the company is also considering making a large contribution to WeWork.
WeWork representatives declined to comment.