It is a crucial time for the future of the office leasing company WeWork as executives are looking at debt plans with SoftBank and new lending terms presented by JPMorgan Chase.
Reports to date have put figures for the SoftBank rescue at between $4-$5billion and WeWork is looking at two plans – one, a loan from JPMorgan Chase and another, cash injection, from SoftBank.
WeWork postponed its Initial Public Offering (IPO) in September. Investors started looking at the company’s debts, losses and cash burn which, despite the assertion from Goldmans that the company’s value was around $90 billion, were a major cause of concern.
The issues were seen by investors as having been glossed over in the hype leading up to the IPO and there were concerns that other non-disclosed problems could come to light in the future.
A boost of confidence in WeWork came from investment by SoftBank in 2017 and this may have hidden the underlying financial issues. It was also noted that the former CEO Adam Neumann cashed out $700 million worth of his WeWork stock shorty before the date of the IPO.