SoftBank has been in a lot of advanced conversations to take control of the looted WeWork workspace company, according to people familiar with the matter.
SoftBank, led by Japanese billionaire Masayoshi Son, plans to spend anywhere between $ 4 and $ 5 billion on new financing and existing stocks, sources say.
The deal will estimate WeWork between $ 7.5 billion to $ 8 billion on pre-financing and can be announced immediately on Tuesday. SoftBank itself takes control, not the startup-focused Vision Fund. After the move, Softbank will have up to 70% or more control of WeWork.
Exec Marcelo Claure exec from SoftBank will participate in the management of the company, while the stock of former CEO Adam Neumann will fall to low double digits. Prior to the acquisition, SoftBank had already invested $ 1
The company reportedly fired at least 2,000 people, about 13% of its staff, as recently as last week. WeWork employees told the Guardian that they believed the layoffs would not stop there, suggesting that more than 15,000 company employees could be fired.
SoftBank's anticipated takeover marks the last chapter in a dramatic year for what was at one time expected to be one of Wall Street's hottest initial public offerings. Last month, the launch stopped plans to publish. Its long-awaited IPO prospectus in August revealed a huge loss of $ 900 million in the first six months of 2019 and raised concerns about its corporate governance practices.
Such concerns peaked in July when We Co. has agreed to pay Neumann $ 5.9 million in stock for the trademark We, previously owned by We Holdings, an investment facility managed by Neumann.
Since Neumann's departure last month, WeWork have been focused on laser raising new capital. The company is in talks with J. P. Morgan to discuss debt financing.
The fallout from the controversy and the subsequent decline in value led to strained relations between the former Neumann and SoftBank's Son, who is investing billions in startups.