World

Office-Sharing US Company WeWork Files For Bankruptcy

By
OB Bureau

New Delhi: Once the most valuable US startup, WeWork, sought bankruptcy protection on Monday after its bets on companies using more of its office-sharing space soured. The SoftBank Group-backed startup’s meteoric rise and fall reshaped the office sector globally.

SoftBank, the Japanese technology group that owns about 60% of WeWork, has invested billions of dollars in its turnaround.

WeWork said it has entered into a restructuring agreement with key stakeholders to drastically reduce its existing funded debt and also intended to file recognition proceedings in Canada. The company’s locations outside of the U.S. and Canada, as well as its franchisees around the world, are not affected by these proceedings, it added.

WeWork shares have fallen about 98.5% so far this year. Profitability has remained elusive, as WeWork grapples with its expensive leases and corporate clients cancelling because some employees work from home. Paying for space consumed 74% of WeWork’s revenue in the second quarter of 2023.

In a filing with the New Jersey bankruptcy court, WeWork listed estimated assets and liabilities in the range of $10 billion to $50 billion.

OB Bureau

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