Masayoshi Son Confirms Softbank Will ‘Double Down’ On WeWork In $5 Billion Rescue Deal

Billionaire investor Masayoshi Son has confirmed that WeWork has accepted an offer from Softbank of $5 billion in new financing and up to $3 billion for existing shareholders.

Leading investor Softbank hopes that WeWork’s fall from a near $50 billion firm will be steadied by Masayoshi Son taking a near 80% share in U.S. office-space-sharing startup.

Announcing the “significant funding to WeWork,” in a statement Masayoshi Son, chairman & CEO of SoftBank said: “It is not unusual for the world’s leading technology disruptors to experience growth challenges as the one WeWork just faced.”

He added, “SoftBank has decided to double down on the company by providing a significant capital infusion and operational support.”

WeWork rents out office space in more than 110 cities around the world. The latest SoftBank deal values the troubled startup at $8 billion, marking a massive $39 billion loss since it was last valued at $47 billion in a January 2019 fundraising round.

Masayoshi Son’s rescue package includes an offer worth up to $3 billion to all non-SoftBank shareholders at a price of $19.19 per share.

SoftBank is coming good early on a $1.5 billion equity investment originally due to the company next year. Following news of the deal the Tokyo-based conglomerate’s share price was down 2.5% at the close.

The statement confirms that SoftBank’s “ownership” of WeWork will be approximately 80%, adding that controversial founder Adam Neumann will become a “board observer” but the expanded board will receive “voting control” over Neumann’s shares.

The investment marks another chapter in a miserable year for Adam Neumann after he resigned as CEO in September 2019 shortly before the company cancelled a planned IPO.

The statement confirms that in their newly structured relationship, WeWork will “not be a subsidiary of SoftBank” but rather an “associate” of SoftBank.

Adam Neumann - Billionaire Once Again

WeWork’s beleaguered founder Adam Neumann is once again a billionaire after SoftBank’s offer allowed Neumann to cash out of most of his shares.

Just weeks after WeWork pulled its plans to go public and Neumann resigned as CEO, Forbes Jennifer Wang reports that SoftBank’s Masayoshi Son, will pay Neumann up to $1 billion for the bulk of his WeWork stock alongside $185 million in consulting fees and extend a $500 million credit line for him to pay back existing loans.

Forbes estimates that Neumann will be a billionaire as a result of the deal.

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I am a wealth reporter at Forbes, based in London covering the business of billionaires, philanthropy, investing, tax, technology and lifestyle. I studied at Goldsmiths