WeWork’s biggest outside shareholder SoftBank is supposed to lead its IPO by J.P. Morgan Chase. Both the companies are working to bring a financial package that could save the office-sharing company. WeWork is assured to run out of cash by November due to no additional funding. SoftBank and J.P. Morgan have been looking for an alternative solution for two weeks and WeWork has been already withdrawing its IPO filing.
To arrange emergency funding, J.P. Morgan is consulting with 100 investors that have signed a non-disclosure agreement to participate firmly. According to Bloomberg, WeWork was rolling toward an almost $5 billion finance package led by J.P. Morgan instead of selling a controlling stake to SoftBank. J.P Morgan is the third biggest outside shareholder after SoftBank and Benchmark. Fortune has been playing dramatically with WeWork that was one of tech’s highest growing private companies.
The latest funding of SoftBank for this year valued the company at $47 billion and set it at the highest IPO. Public investors are not ready to comply because of cash-burning companies such as Lyft and Uber, that are leading up to WeWork’s filling after the sales of their shares in the months.
When WeWork hinted a $900 million loss in the past six months in its prospectus, investors got frustrated. The company that would rent out co-working spaces to startups, freelancers, and enterprises has to rush cash into real estate and in some most expensive markets. As the financials were studied, corporate governance started showing in reports about questionable behavior from ex-CEO Adam Neumann.
