Share of office landlord WeWork suspended from trading
Last week, it was reported that WeWork was planning to file for bankruptcy in New Jersey this week in order to get its debts under control. The start-up, which was once valued at 47 billion dollars and is backed by Japanese tech investor SoftBank, is now only worth 44 million dollars on the stock exchange. WeWork has never been in the black. Plans to reduce costs to such an extent that the company would at least no longer be burning money failed due to the weakness of the office real estate market.
Last Tuesday, a 30-day deadline had expired within which WeWork would have had to service promissory bills. However, the company let the deadline pass. The rating agency Fitch classifies this as a "limited credit default" and has downgraded WeWork's liabilities with a volume of 1.4 billion dollars accordingly. However, the business model is fundamentally viable if WeWork succeeds in achieving higher capacity utilization and divesting itself of weak locations.
In light of WeWork's financial struggles, an insolvency application might be imminent, potentially affecting its share value. Despite the 30-day deadline passed without servicing promissory bills, WeWork's office landlord has yet to make an insolvency application related to the company's share.
Source: www.ntv.de
