Breaking from CNBC:
SoftBank will take control of embattled work space company WeWork, according to people familiar with the matter.
SoftBank, led by Japanese billionaire Masayoshi Son, plans to spend somewhere between $4 billion and $5 billion on new equity and existing shares, sources say. Most of the purchases, sources told CNBC, will be in new equity.
The deal will value WeWork between $7.5 billion to $8 billion and could be announced as soon as Tuesday. It is SoftBank itself taking control, not the start-up focused Vision Fund. After the move, SoftBank would then have as much as 70% or more control of WeWork.
If true, it will bring the total amount of capital invested in the We Company, née WeWork, to between $16.8bn and $17.8bn. All for a valuation of $7.5bn to $8bn. Nice one guys.
There are plenty of lessons to be learned from the We debacle. A few being: don’t invest in a chief executive who takes conference calls from a hot tub, smokes weed and has an intense relationship with the number 18.
But here’s one for SoftBank, if you want to invest in a hot co-working space which leverages the growth potential of the entrepreneur economy, perhaps just pick a company where freelancers already congregate en masse.
Since SoftBank’s first investment in WeWork, back in August 2017, the Seattle coffee company’s shares are up 57.19 per cent, according to S&P Capital IQ. Without doubt, Masa Son would take such a return on his capital right now.
WeWork Founder Mixed Spiritual Group With Business – WSJ