OAN’s James Meyers
10:52 AM – Tuesday, November 7, 2023
WeWork, the office-sharing company, has officially filed for Chapter 11 bankruptcy after being valued at $47 billion just four years ago.
The company filed for bankruptcy protection in a New Jersey federal court on Monday, claiming they had entered into agreements with the vast majority of its secured note holders and it wanted to get rid of “non-operational” leases.
The company reported liabilities ranging from $10 billion to $50 billion, according to the filing.
“I am deeply grateful for the support of our financial stakeholders as we work together to strengthen our capital structure and expedite this process through the Restructuring Support Agreement,” WeWork CEO David Tolley said in a press release. “We remain committed to investing in our products, services, and world-class team of employees to support our community.
“As part of today’s filing, WeWork is requesting the ability to reject the leases of certain locations, which are largely non-operational and all affected members have received advanced notice,” said Tolley in a statement.
This comes after WeWork was once valued at $47 billion in 2019. The company reportedly attempted, but failed, to go public five years ago due to investors balking at high debt levels, prompting massive losses and running through cash at an alarming rate.
In an attempt to keep its New York Stock Exchange listing, the company announced a 1-for-40 reverse stock split in August in order to get its shares trading back above $1.
Former CEO and co-founder, Adam Neumann, expressed that the filing was “disappointing” in a statement to the press.
“It has been challenging for me to watch from the sidelines since 2019 as WeWork has failed to take advantage of a product that is more relevant today than ever before,” Neumann said in a statement to CNBC. “I believe that, with the right strategy and team, a reorganization will enable WeWork to emerge successfully.”
In September, WeWork said it was actively re-negotiating leases and that it was “here to stay.”
The company had a staggering $16 billion in long-term lease obligations, according to its securities filings. Currently, the office-sharing group leases millions of square feet of office space in 777 locations around the world.
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