A tumultuous week for WeWork will ultimately bring more investment money for the office-sharing firm, Reuters reported on Wednesday (Sept. 25).
Japan’s SoftBank Group is reportedly planning to pump an extra $1 billion or more into WeWork through “a renegotiated warrant agreement,” sources told Reuters.
The warrant agreement was struck before the stalled IPO and falling valuations.
SoftBank wants to change the warrant agreement so it will get a larger share of WeWork’s stock at a reduced price, the sources said.
The deal renegotiation is just one of several options being considered by the Japanese conglomerate, and talks are still in the early stages, the sources said.
This new infusion of cash by SoftBank could open the door to more funding options for WeWork.
This news follows a recent shakeup for WeWork when its CEO Adam Neumann stepped down. Executives Sebastian Gunningham and Artie Minson took the helm as co-CEOs. Neumann will remain the non-executive chairman of the company.
The IPO is still in the works — however, the October opening date won’t be met.
The IPO was postponed amid questions about how much the company is worth. The company’s value dropped from $47 billion earlier in the month to around $15 billion.
The lower valuation will hurt SoftBank, as it is currently looking for capital from investors for a second Vision Fund. SoftBank’s returns have already been impacted by less than stellar performances from Uber and Slack, which both recently went public.
There is also the looming issue of the hard-partying corporate culture at WeWork. Neumann recently had to reschedule a private plane he commissioned because the crew allegedly found marijuana on board. Neumann also told people he was going to live forever, serve as Israel’s prime minister, become president of the world and be the world’s first trillionaire.