by Droobfest on 4/30/20, 9:43 AM
The highly leveraged conglomerate has been forced into selling major assets to raise funds, but could receive a big boost from the Bank of Japan’s plan to expand corporate bond buying, which would support its predilection for borrowing.The Japanese taxpayer (Yen-holder) having to support the losses of Adam Neumann's personal money tree seems pretty crazy to me.
by code4tee on 4/30/20, 12:53 PM
WeWork is effectively worth nothing at this point.
Their revenue surely has tanked given everything and won’t just magically return to normal. They’re sitting on massive liabilities with all the leases and capital they invested in locations. Yes leases could be renegotiated etc. but given WeWork’s woes that long predate COVID-19 it’s very unclear how they survive much longer beyond perhaps being sold for scrap in some sort of fire sale.
It’s crazy to remember that less than a year ago there was serious movement towards a WeWork IPO.
by simonh on 4/30/20, 9:34 AM
The shame is that they will probably blame all of this on the Pandemic, rather than fundamental issues with the business that were becoming clear long before the virus hit.
by roland35 on 4/30/20, 9:23 AM
“Every writedown takes Wework’s carrying value closer to reality. Clearly the value is zero,” said Kirk Boodry, an analyst at Redex Holdings.I wonder if the value will be less than 0 soon with all of the liabilities WeWork has!
by aryonoco on 4/30/20, 9:30 AM
Best quote from an analyst: “Every writedown takes Wework’s carrying value closer to reality. Clearly the value is zero,”
by ckastner on 4/30/20, 9:20 AM
> The tech conglomerate has poured more than $13.5 billion into WeWork
So the potential downside is still even larger.
Seeing as WeWork needs to continue to pay their long-term leases, 2020 is not going to look good for them thanks to Covid-19.
by adreamingsoul on 4/30/20, 9:24 AM
"A billion here, a billion there, pretty soon, you're talking real money." -- Everett Dirksen
by lefstathiou on 4/30/20, 12:37 PM
I wonder if Japanese tax laws are similar to the US in that they incentivize write downs to create net operating losses to offset future profit. For SoftBank, which operates a very profitable core business, losses here could ensure no tax payments for years to come. This happened in 08 with many of the fire sales in the mortgage and banking business.
by _pmf_ on 4/30/20, 10:08 AM
I'm starting to believe this is some plot to disenfranchise the Saudis, because the dimensions are too large for plain stupidity.
by nutshell89 on 4/30/20, 1:15 PM
I'm curious as to how this might impact other Vision Fund companies like Fanatics or Mapbox.
by shadowpawn on 4/30/20, 7:50 PM
I do miss the free beer and wine at my local WeWorks from 1500 each work day :-(