OFFICE CO-WORKING COMPANY WeWork plans to file for bankruptcy as early as next week, according to reports from The Wall Street Journal yesterday.
In August, the company said there was “substantial doubt” over its ability to stay in business over liquidity and profitability issues, but hinted that the firm could stay afloat if the issues were resolved within the next 12 months.
However, according to reports from the American business broadsheet, the company has been struggling with a debt and losses and has considered filing a ‘Chapter 11 bankruptcy petition’ – to allow the company to restructure its debts.
This petition could be filed as early as next Tuesday, the newspaper claimed. Asked by TheJournal to confirm these reports, a WeWork spokesperson said the company does not comment on speculation.
In a filing yesterday, the firm said it held discussions with its creditors about “improving its balance sheet” and rationalising its real estate “footprint”.
On Monday, the company entered into a forbearance agreement with its creditors – a temporary funding postponement – that will end in seven days.
Stock prices, at the time of publishing, show prices have fallen by a considerable amount since the report by the newspaper was published.
The firm, with four locations in Dublin, leases buildings and divides them into office spaces to sublet to its members. TikTok currently occupy the company’s Harcourt Road offices in Dublin City while they await their move into two new spaces in the city.
WeWork went public in 2021, after a failed attempt to do so by its former CEO and founder Adam Neumann. Since, however, operating costs have soared for the company as it relied on a number of funding injections from private investors.
In August, the company said it was facing a high turnover rate, and planned to negotiate more favourable lease terms, control spending and seek additional capital by issuing debt, stock or selling assets.
The company announced it planned to open its newest space in the old Central Bank building – named Central Plaza. It also opened booking to clients at “pre-opening rates”.
According to its website, WeWork planned to occupy “all eight floors” of the new development. The developers yesterday secured an €80 million loan to support the redevelopment of the site, the Business Post reported.
WeWork’s four Dublin sites are located in Charlemont Exchange, Harcourt Road, Dublin Landings in the docklands and the former Central Bank building.
The Wall Street Journal said the company would file for the petition 11 bankruptcy in New Jersey in the United States.
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