WeWork, the flexible work-space company at the center of a high-profile scandal that led to the ousting of its founder Adam Neumann, has officially filed for Chapter 11 bankruptcy protection in the US.
The company ran into financial trouble after attempting to go public in 2019, leading to the collapse of its $47 billion valuation and the ousting of founder Adam Neumann. The Wall Street Journal reported the company’s filing.
WeWork had been attempting to restructure its business following the abruptly canceled IPO in September 2019. Although the company raised high profile investments from SoftBank, JPMorgan, and Goldman Sachs, it failed to stabilize and spent months attempting to negotiate a deal with its creditors.
In an effort to save the company, WeWork laid off thousands of employees, closed hundreds of locations worldwide, and sold off numerous assets and businesses.
The bankruptcy filing is expected to restructure WeWork’s balance sheet, allowing it to emerge as a much leaner firm with a more manageable debt burden. WeWork’s new executive team says it will shift to a business structure that focuses on core operations and technology.