WeWork in talks with investors to restructure over $3 billion debt: New York Times
BENGALURU: WeWork Inc is in talks with investors to restructure its outstanding debt of more than $3 billion and raise more cash, the New York Times reported on Tuesday.
Shares of the company rose about 5% in extended trading following the news.
The company, which offers workstations, private offices and customized floors, had enjoyed a pandemic-driven shift to flexible work outside traditional offices, but is now gearing up for a potential fallout from a likely economic downturn.
In February, WeWork forecast weak current-quarter revenue in a sign that its business was feeling the heat of mass layoffs as companies reduce their real estate footprint.
An infusion of cash would most likely give WeWork the hundreds of millions of dollars it needed to keep operating for at least a few years, the NYT report added, citing people with knowledge of the negotiations.
Yardi, a real estate software provider in Santa Barbara, California, is among the investors considering new investment in the company, the people told the newspaper.
WeWork did not immediately respond to a Reuters request for comment.
The report citing one of the people, said there is no guarantee that the WeWork deal will close, and even if it does, it could be weeks away.
Japan’s SoftBank Group Corp, which is both WeWork’s largest shareholder and its largest debtor, is playing a key role in the negotiations but is not expected to put any additional money into the company, the report said.
In January, the New York-based company also planned to eliminate about 300 roles across countries after announcing last year, it would exit about 40 underperforming U.S. locations due to high expenses and a strong U.S. dollar.