SoftBank wires $1.5 billion to WeWork before cash runs out
WeWork said it received an early payment of $1.5 billion from SoftBank Group, as the co-working company was weeks away from running out of money. As a result, a slate of governance changes went into effect Wednesday, including the replacement of co-founder Adam Neumann as chairman and the assignment of five board seats to SoftBank, which will take a majority stake. WeWork also said it appointed a new independent director to the board, Jeff Sine, co-founder of financial firm Raine Group. “This financing package enables the company to accelerate the path to profitability,” Marcelo Claure, WeWork’s new executive chairman, said in a statement. The $1.5 billion investment was announced in January and was originally scheduled for April 2020. The deal was accelerated as part of a bailout package for WeWork from SoftBank to rescue the troubled co-working startup after a failed initial public offering.
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