WeWork, which was once one of the most profitable and widely spread co-working space company, has now filed for bankruptcy. The once multi-billion dollar company filed for Chapter 11 bankruptcy in a New Jersey federal court on November 6, as reported by CNBC International.
The co-working company once held a valuation of dozens of billions, but now has dropped down to zero. WeWork had entered into agreements with massive majority of its secured note holders and it intended to trim “non-operational” leases.
While declaring bankruptcy, WeWork CEO David Tolley said in a press statement, “I am deeply grateful for the support of our financial stakeholders as we work together to strengthen our capital structure and expedite this process through the Restructuring Support Agreement.”
The CEO also clarified that the bankruptcy is limited to just the US and Canada locations of WeWork. The co-working firm listed a debt of USD 19 billion, which comes out to over Rs 1.5 lakh crore in Indian currency.
The company struggled to recover from the losses incurred during the Covid-19 pandemic, despite being valued at USD 47 billion, and its initial public offering in 2019 failed. WeWork also had to close many of its global locations to recover the losses, but these measures were not sufficient.
WeWork owns real estate across 39 countries, running 777 co-working locations across the globe. WeWork’s bankruptcy comes as many other co-working space firms are struggling to break even and make a profit after the pandemic and global lockdown.
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