WeWork, an office-sharing company, could be filing for bankruptcy as early as next week, according to a source quoted by Reuters.
The news comes as its debts have continued to grow while losses mount.
Shares have continued to fall in WeWork as the news was announced. This year has shown a remarkably reversal in fortune for the company, with its shares down over 95 percent since the start of the year. As a private business, the shared office space company was once seen as a darling of the startup world, with a valuation of $47 billion.
According to the Wall Street Journal, which first reported on the company’s troubles, WeWork is considering filing a Chapter 11 petition in New Jersey. Chapter 11 is a form of US company bankruptcy which permits some reorganisation.
WeWork’s ongoing financial struggles
Since 2019 the company has continued to struggle, as debts have mounted. As of the end of June this year, net long-term debt in the company hit $2.9 billion, with more than $13 billion in long-term leases.
Japanese conglomerate SoftBank has invested tens of billions of dollars into the company to prop it up, but WeWork has continued to lose money.
In August, the shared-office provider raised “substantial doubt” over its ability to continue operations, while several top executives have left the company, including CEO Sandeep Mathrani.
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