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Office-space provider, WeWork (NYSE:WE), has filed for Chapter 11 bankruptcy protection, as it faces liabilities between $10 billion and $50 billion.
What Happened: The filing is limited to the company’s locations in the U.S. and Canada, CNBC reported. The firm stated that it had entered into agreements with a majority of its secured noteholders and plans to cut “non-operational” leases.
“We remain committed to investing in our products, services, and world-class team of employees to support our community,” said WeWork CEO David Tolley.
Why It Matters: In recent years, WeWork has witnessed a dramatic corporate downfall, failing an IPO attempt and suffering from the pandemic-induced economic downturn. The company’s value plummeted by 98% since its debut through a special purpose acquisition company in 2021.
“I believe that, with the right strategy and team, a reorganization will enable WeWork to emerge successfully,” stated former CEO and co-founder Adam Neumann.
In September, WeWork was actively renegotiating leases with approximately $16 billion in long-term lease obligations. The firm leases millions of square feet of office space across 777 locations globally.
Before the stock halt on Monday, WeWork shares were trading at about 83 cents, down from a low of about 10 cents.
Image: Shutterstock/ Tada Images
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