Shares in the troubled office-sharing firm WeWork plunged on Wednesday, following reports it could file for bankruptcy as early as next week. Its shares fell by more than 50% in early trade in New York. The firm was once seen as the future of the office. But it has been plagued by problems, including a disastrous attempt in 2019 to sell shares to the public and the exit of its co-founder. WeWork declined to comment when contacted by the BBC. The company was also hit hard by the pandemic as more people started working from home. WeWork is considering filing for bankruptcy in New Jersey, according to the Wall Street Journal, which first reported the story. The Reuters news agency also reported the story, citing a source familiar with the matter. In response to the reports, a WeWork spokesperson said: “We do not comment on speculation.” Earlier on Tuesday, the company told the US financial regulator it had agreed with creditors to temporarily postpone payments for some of its debt. Jane Sydenham, investment director at Rathbones, told the BBC that WeWork had been “a great idea” when it started out. “We all know that flexible working and being able to use offices on an ad-hoc basis is a helpful opportunity to have,” she said. “But I think the problem with WeWork was it over-expanded, borrowed too much money, took on too many sites too quickly, didn’t really put in place all the checks and balances and controls that a company needs to have.” Ms Sydenham added that WeWork had also been hit by the rise in interest rates, which made borrowing more expensive.
Full exclusive : WeWork, once valued at $47 billion, plans to file for Chapter 11 bankruptcy as early as next week; WeWork stock plunges by 50%.
