By Andy Silvester
WeWork, the office leasing company, is headed for Chapter 11 bankruptcy protection according to a number of reports in the US overnight.
The firm has been battling a substantial debt pile for years and earlier this yearflagged going concern worries to investors.
Bankruptcy protection in the US would give the firm, which once badged itself as leading a workplace revolution, some time to perform open-heart surgery on its finances.
Shares in the company crashed in after-hours trading on Wall Street yesterday, falling by more than a third.
The shares have lost more than 95 per cent of their value since the turn of the year.
WeWork had looked set for a bumper float in 2019 before concerns over then-boss Adam Neumann’s leadership emerged in the weeks prior to its IPO.
The float was eventually shelved until 2021.
The company lost £700m in the first six months of the financial year in 2023, fighting against a slow-to-return workforce in the United States in particular.
The Softbank-backed company reported only a 72 per cent occupancy rate in those same half-years.
The firm is sitting on around $3bn worth of debt, and is also on the hook for more than $10bn in long-term leases it has already signed.
It is not clear what would happen to employees in a Chapter 11 situation.
WeWork did not comment in response to the original story published in the Wall Street Journal.
