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WeWork declares bankruptcy: The company’s debts range between $10,000 and $50,000

WeWork declares bankruptcy: The company’s debts range between $10,000 and $50,000

WeWork declares bankruptcy (Reuters)

American coworking company Wework It was announced on Monday in bankruptcyAfter years of financial problems that led her to this Its debt is more than $10 billion.

The company announced, in a statement, today, Monday, its decision to benefit from Chapter 11 Of the bankruptcy law United State Before the court in New Jersey.

According to documents submitted to the court, the company was founded in 2010 by an Israeli businessman Adam Newmanhas debt ranging between $10,000 and $50,000 million.

WeWork has detailed this It has already entered into a debt restructuring agreement With creditors who obtained more than 92% of its secured securities, which includes reducing its commercial leasing portfolio, with a focus on “the continuity of its business,” according to the statement.

“We are committed to investing in our products, services and team,” the company’s CEO said. David Tolleyin writing.

The company, which provides co-working spaces, added that it hopes to be able to continue its operations globally and explained that the decision to file for bankruptcy law This will not affect WeWork franchises outside the US and Canada.

The joint business company’s debts range between 10,000 and 50,000 million dollars (Reuters/File)

Financial problems of the evaluated company 47 billion dollars In 2019 after an injection of private capital from companies such as Softbank also Goldman Sachsas a result of the Coronavirus pandemic, when the remote work model began to spread in the United States.

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“The company has been in turmoil since its plans to go public in 2019 collapsed following investor doubts about its business model of taking long-term rentals and renting out short-term and concerns about its significant losses,” the company said last week. an agency Reuters In the news preview.

“WeWork’s problems did not diminish in the following years. It was finally able to go public in 2021 at a deeply discounted valuation. Its main sponsor, Japanese conglomerate SoftBank, invested tens of billions to back the startup, but the company continued to lose money.

WeWork was valued at $47 billion in 2019 after an infusion of private capital (Reuters/File)

WeWork raised in August “Great doubts” Despite its ability to continue operating, several senior executives, including CEO Sandeep Mathrani, have left the company this year.

The company then said that over the next year it would focus on reducing rental costs, negotiating more favorable rents, increasing revenues and raising funds.

“We will continue to invest in our product offerings while taking steps to reduce rent and leasing costs. Our members remain our top priority, and regardless of any short-term actions we may take, we will continue to operate and serve them for the long term,” a WeWork representative said in a statement.

(With information from EFE)