SoftBank has made a $5 billion debt financing offer to keep WeWork afloat. The deal would make the Japanese technology conglomerate the majority owner of the U.S. office-space sharing company
) offered close to $10 billion to WeWork owner The We Company, its employees and its investors on Monday under a plan to keep the struggling U.S. office-space sharing start-up afloat that would lead to the exit of its co-founder and Chairman Adam Neumann, people familiar with the matter said.
SoftBank has offered $5 billion in new money to WeWork in the form of debt, the sources said. It is also proposing to accelerate a previous $1.5 billion equity commitment to WeWork in the form of warrants that are due in April, the sources added. SoftBank and its $100 billion Vision Fund already own about a third of WeWork through previous investments totaling $10.6 billion.
One is Bruce Dunlevie, who is a general partner at WeWork shareholder Benchmark Capital. The other is Lew Frankfort, who is the former CEO of luxury handbag maker Coach. The We Company’s board has also agreed on a cost-cutting plan that includes layoffs, Reuters reported last week. The cuts will occur over the coming weeks, the sources added.Neumann’s exit from The We Company’s board would represent a dramatic fall from grace, given Wall Street’s expectations earlier this year that he would lead one of corporate America’s most hotly anticipated stock market debuts.
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