WeWork Drawn to J.P. Morgan's Financing Package
Embattled office space firm WeWork Companies is leaning towards a near $5 billion financing package led by J.P. Morgan Chase rather than face dilution.
Instead of selling a controlling stake to Japan's SoftBank Group Corp, the office rental giant prefers to get financing provided by J.P. Morgan, «Bloomberg» (behind paywall) reported on Monday, citing people familiar with the matter.
The deal may include at least $2 billion of unsecured notes with a 15 percent coupon.
No Dilution
WeWork prefers the J.P. Morgan package over a stake sale to SoftBank because this financing choice would not dilute the stakes of top private shareholders. Softbank already owns around one-third of the company.
Various media reported earlier in October that WeWork and J.P. Morgan were negotiating a debt deal after the company postponed last month’s initial public offering due to rising concerns among investors about its valuation and its business model. The Guardian newspaper reported earlier on Tuesday that WeWork is expected to sack at least 2,000 people as early as this week.
