Home / Business / WeWork confirms a $ 8 billion lifeline from the SoftBank Group; Appoints New CEO – TechCrunch

WeWork confirms a $ 8 billion lifeline from the SoftBank Group; Appoints New CEO – TechCrunch

In confirmation of earlier reports, We Company and the SoftBank Group agreed on a new capital injection, with SoftBank earmarking $ 5 billion in new financing and a $ 3 billion takeover bid for shareholders emits.

This would accelerate an existing commitment to invest $ 1.5 billion in short-term real estate leasing.

Under the terms of the agreement, WeWork will receive $ 1.5 billion to be raised by SoftBank in April 2020 for $ 11.60 per share. This money is expected within seven days of the signing of the contract (subject to shareholder approval).

There is also a $ 3 billion third-party takeover offer priced at $ 19.19 per share scheduled to commence in the fourth quarter of this year, subject to regulatory approvals.

Finally, there is a joint venture stock swap whereby all of the shares of the SoftBank Vision Fund are swapped to regional joint ventures outside Japan at a price of $ 11.60 per share "and a credit facility consisting primarily of secured debt securities of $ 1.1 billion, unsecured debt securities of $ 2.2 billion and a credit facility of $ 1.75 billion granted after the closing of the Takeover bid.

According to a statement, SoftBank will hold approximately 80 percent of the We Company in the Takeover Offer.

However, SoftBank will not actually hold a majority of voting rights in a shareholder or Bo Thanks to the nested ownership structure of WeWork, WeWork is not a subsidiary, but a "partner" of SoftBank, despite its 80 percent interest in the company.

Under the agreement, the company confirmed that Adam Neumann will be chairman of the board and Marcelo Claure, the chief operating officer of the SoftBank Group, will assume the position of executive chairman of the WeWork board of directors as soon as the company completes its payment receives $ 1.5 billion from SoftBank.

"SoftBank is firmly convinced that the world is underway a massive change in the way people work. WeWork is at the forefront of this revolution. It is not uncommon for the world's leading technology disrupters to experience growth challenges that WeWork has just faced, "said Masayoshi Son, Chairman and CEO of SoftBank Group Corp., in a statement. "With the vision unchanged, SoftBank has decided to double the company with substantial capital and operational support. We remain committed to WeWork, its employees, its member customers and landlords.

The vision may remain unchanged, but the story that SoftBank has to tell about its new "employee". Under Neumann's leadership, We Company was a money-burning, global, all-encompassing community developer who would initiate a new kind of capitalism that operates under the motto "we".

Now the company is more like a difficult temporary office space provider with a mountain of leases and looking down the path of a potential money crisis – even with the SoftBank lifeline.

SoftBank executives and WeWork's new leadership continue to stand for what the company is and can be.

community. The new capital that SoftBank will provide will revive the company, and I seek to achieve profitability and positive free cash flow, "said Claure in a statement. "As important as the financial impact is, this investment demonstrates our confidence in WeWork and its ability to continue disrupting the commercial real estate market by providing flexible, collaborative and productive work environments for our clients."

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