SoftBank is in talks to provide WeWork with about US$5 billion of rescue financing weeks after the co-working firm’s parent, the We Company, filed to withdraw its initial public offering.
Masayoshi Son / Photo credit: SoftBank
The funds will directly come from SoftBank, rather than its Vision Fund, and part of the package may include non-voting preferred stock, Bloomberg reported, citing a person familiar with the matter.
The Japanese multinational conglomerate, which already owns about a third of WeWork, will not acquire a majority of voting rights with the added funding, but its stake is set to increase, the source added.
Representatives for WeWork and SoftBank declined to comment on SoftBank’s proposal, according to the report.
The development comes days after it was reported that SoftBank has plans to assume more control over WeWork through a financing package that would further dilute the influence of co-founder Adam Neumann, who stepped down as CEO of the co-working company last month.
A source recently said that Son believes the embattled startup can be turned around, according to the report.
SoftBank was previously said to be in discussions to pour US$1 billion or more into WeWork, which would come in addition to the US$1.5 billion it has already agreed to inject into the company next year. To date, the company has already invested more than US$10 billion in WeWork.
Additional investment from SoftBank could open up more financing options for WeWork, which is also in talks with a syndicate of banks to raise US$3 billion to US$4 billion in debt, contingent on it raising more capital first.
Editing by Charmaine de Lazo
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