After a long period of anguish, there’s finally some positive development for co-working space provider WeWork (OTC:WEWKW) (DE:9WEA). The company exited bankruptcy this week and announced the appointment of a new CEO.
WeWork’s Troubles
WeWork was valued at as much as $47 billion at its peak. Its co-founder Adam Neumann exited WeWork in 2019 after plans to take the company public failed. While WeWork eventually went public in 2021, it filed for bankruptcy in November last year amid financial pressures. The company had liabilities of around $18.65 billion at the time of its bankruptcy filing.
WeWork’s Massive Restructuring
Now, the company has completed its global operational and financial restructuring and brought in new leadership. Its restructuring effort involved slashing future lease obligations in half, significantly reducing debt, and raising $400 million in additional equity capital. The company renegotiated over 190 leases and exited over 170 locations. David Tolley, who oversaw this effort as WeWork’s CEO, is stepping down from his role as both CEO and a director of WeWork.
Taking over the company’s reins from Tolley is John Santora, a veteran in the commercial real estate industry. Most recently, Santora served as the Tri-State Chairman at Cushman & Wakefield. Despite the scaling back of its real estate footprint, WeWork still has a formidable presence with 600 locations in 37 countries.
Notably, WeWork’s second inning comes after the company declined a $650 million takeover offer from Adam Neumann earlier this year. Meanwhile, Masayoshi Son’s SoftBank (OTC:SFTBY), which once counted WeWork as one of its most prized investments, will still hold a minority stake in the company.
Is WeWork a Good Stock to Buy?
Not surprisingly, WeWork’s shares have soared by nearly 500% over the past five days. Still, the stock remains nearly 99.6% lower over the past year. While analyst coverage on WeWork remains scant at present, the TipRanks Technical Analysis tool is flashing a Sell signal for the stock on a monthly time frame.
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