NEW YORK (Reuters) - SoftBank Group Corp (9984.T) is attempting to become the majority owner of WeWork without assuming the onerous lease obligations of the U.S. office-space sharing firm, according to people familiar with the matter.
SoftBank is offering a $5 billion financing lifeline that The We Company, the parent of New York-based WeWork, is assessing against a proposal by JPMorgan Chase & Co (JPM.N) for a debt package of similar size from banks and institutional investors.
WeWork could run out of cash as early as next month without new financing, sources have said, after the company pulled plans in September for an initial public offering (IPO). It abandoned the IPO when investors questioned its large losses, the sustainability of its business model and the way WeWork was being run by its co-founder and former CEO Adam Neumann, who now serves as board chairman.
Over the weekend, a special board committee formed by The We Company to evaluate the financing proposals, ring-fenced from the influence of SoftBank and Neumann, was working around the clock with its advisers to reach an agreement, the sources said. The negotiations could spill into next week, one of the sources cautioned.
SoftBank and its $100 billion Vision Fund own about a third of WeWork through previous investments totaling $10.6 billion.
SoftBank’s latest offer values WeWork at less than $10 billion, according to two of the sources, a fraction of the $47 billion it assigned to it in January in a previous fundraising round.
LEASE LIABILITIES
While the split in SoftBank’s contribution between equity and debt is still being negotiated, its investment could make
