WeWork (NYSE:WE), once valued at $47 billion, is on the brink of filing for bankruptcy as early as next week, according to sources cited by the Wall Street Journal. This news sent its shares diving by over 37% in pre-market today. The company intends to file a Chapter 11 petition in New Jersey.
In early October, WeWork missed its interest payments, starting a 30-day grace period. If unmet, this leads to a default. Yet, a recent agreement with bondholders extended discussions by seven days, seeking to avert the looming default.
Following a board reshuffle in August, which saw the addition of directors adept in financial restructuring, WeWork has been recalibrating its leases. As of mid-year, the company had 777 global locations, lease commitments nearing $10 billion through 2027, and additional obligations of $15 billion post-2028.