The coworking company WeWork (OTCMKTS: WEWKQ) announced the securing of $450 million in new funding that will fuel its exit from Chapter 11 bankruptcy.
The property management software provider Yardi Systems is taking a 60% stake in WeWork through its subsidiary Cupar Grimmond and will contribute $337 million of the new funding. The remainder of the funding will come from a group of lenders including SoftBank and BlackRock.
This plan shuts down efforts by WeWork co-founder and former chief executive Adam Neumann to regain control of the company through his real estate company Flow Global. Neumann reportedly submitted an offer to acquire the co-working company for more than $500 million.
The Yardi infusion requires court approval. However, the funding plan does not address the question of WeWork’s 300,000-square-foot headquarters at Tower 49 in Manhattan – during Monday’s bankruptcy hearing, the company said it would reject its lease because it could not continue operating in the space. The company has 337 global locations, including 178 across the U.S. and Canada.
“Over the past six months, we have worked extremely hard to develop a plan for a reorganized WeWork that is better capitalized, more operationally efficient, and positioned for continued investment in our products and services and a return to long term growth,” said WeWork CEO David Tolley said in a statement.
Photo: ajay_suresh / Flickr Creative Commons
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