[bctt tweet=”SoftBank, WeWork’s largest investor, is expecting to value the coworking firm at $8 billion through a financial package that it is putting together.” username=”allwork_space”]
Although this deal could help keep WeWork afloat, SoftBank’s Masayoshi Son could face a diminished reputation — which is not great news as the company attempts to launch its Vision Fund 2. Still, if SoftBank can pull this off, the Japanese conglomerate would greatly benefit and possibly obtain a controlling stake in WeWork.
The Vision Fund 1 currently has a stake of around 29%, and Son may be able to increase it while lowering the average price that he paid.
While the talks are not concrete, the likely result of this package scenario is that current shareholders will be losers. Their stakes will get diluted and their investment values will be cut.
WeWork is still weighing two options: an equity deal with SoftBank or a debt package put together by JPMorgan Chase.
If WeWork takes the SoftBank package, it could infer that JPMorgan could not put together a deal that its group of 100 investors could embrace.
Overall, if SoftBank and Son want to raise money for its second Vision Fund, it needs to be in good graces with already skeptical investors.
