Office-sharing company WeWork filed for Chapter 11 bankruptcy protection in New Jersey federal court Monday, saying that it had entered into agreements with the vast majority of its secured note holders and that it intended to trim “non-operational” leases, CNBC reports.
The bankruptcy filing is limited to WeWork’s locations in the U.S. and Canada, the company said. WeWork reported total debts of $18.65 billion against total assets of $15.06 billion in an initial filing.
Analysts and commentators were unsurprised by the bankruptcy filing (which WeWork warned in August might be coming) — only that it took this long to happen.
WeWork merged with BowX Acquisition in October 2021. The deal pumped about $1.3 billion into the company.
The office sharing company was valued at $47 billion in 2019. Later that year, after WeWork’s sky-high valuation failed to pass the smell test with investors poring over its financials, the company nearly imploded.
Within about a month, the coworking office-space company hacked its valuation nearly 80% — down to $10 billion from $47 billion, removed co-founder Adam Neumann as CEO, and delayed its IPO indefinitely. In October 2019, WeWork was taken over by Softbank, its biggest investor, which gave Neumann a $1.7 billion golden parachute to leave. By the end of the third quarter of 2019, Softbank had assigned WeWork a $5 billion valuation. Read more.
