Softbank Could Soon Be Taking Control of Struggling Startup WeWork

WeWork, which was once expected to be a Sillicon Valley darling on Wall Street, may soon be taken over by Softbank.

The start-up at one point was anticipated to be one of the biggest IPOs to hit the market, but the company is now
nearly out of cash and has pulled its plans to go public.

According to reports, the company will be bailed out and taken over by SoftBank at a steeply discounted valuation.
CNBC reported on Monday that WeWork, which is led by Japanese billionaire Masayoshi Son, will pay in between $4 billion and $5 billion in fresh funding. This deal could value WeWork at nearly $8 billion.

Last month S&P Global downgraded WeWork’s credit rating, citing doubts about the company’s ability to “meet its capital investment funding needs and liquidity covenant over the next 12 months.”

“Underpinning these uncertainties are challenging market conditions including a heightened risk of recession in the U.S., Brexit worries, and a slowdown of the Chinese economy (both London and China are major markets for The We Company),” S&P also said.

WeWork’s co-founder Adam Neumann was also ousted earlier this month according to the Wall Street Journal.