SoftBank plans to acquire full ownership of WeWork Japan, assuming the company’s business-related debts. This move comes just four months after the troubled coworking business, once valued at $47 billion, filed for bankruptcy in the U.S.
WeWork Japan has filed a petition for civil rehabilitation at the Tokyo District Court and received approval, allowing SoftBank to integrate the group entirely through a newly established subsidiary, as stated in a media release on Thursday.
“During the period of the business succession process, we expect no changes to service levels or contract terms for current WeWork Japan members … and services will continue to be provided as before,” WeWork Japan stated on Thursday.
The collaboration between SoftBank and WeWork Japan will focus on initiatives for smart buildings and smart offices to create synergies and drive future business growth, according to the statement.
The completion of the business transfer is anticipated in April. The exact amount of WeWork Japan’s debt has not been publicly disclosed.
“There are no plans to close any locations due to this reorganization,” a SoftBank spokesperson stated on Friday. “SoftBank will continue to fully support the provision of WeWork Japan’s services and its management team.”
SoftBank was already a significant shareholder in WeWork, and CEO Masayoshi Son has been a long-term investor in the company, remaining committed throughout its ups and downs. Despite WeWork’s financial struggles in 2019, Son expressed optimism about the coworking company’s future prospects, expressing his desire to increase investment in the company, despite skepticism from other investors.
“Some of my investors say ‘Masa, you get too excited and too much concentration into one company, don’t go too far,'” Son mentioned in an interview with CNBC.
WeWork, founded in 2010 by entrepreneur Adam Neumann with the goal of revolutionizing coworking culture, faced various internal challenges as it prepared for an initial public offering (IPO), including concerns about Neumann’s leadership, leading to his removal as CEO. The company abandoned its IPO plans at that time but later went public in 2021.
More recently, the shift towards remote work due to the pandemic has significantly impacted WeWork due to its high rental costs.
WeWork operates in approximately 631 locations across 119 cities worldwide. WeWork Japan launched its first space in Tokyo in February 2018 and has around 40 locations in the country.
(Source: Japan Times | Nippon.com)
