We work received US $1.5 billion from Softbank in advance

 We work received US $1.5 billion from Softbank in advance

Netease science and technology news on October 31, according to foreign media reports, Wework, a start-up of sharing office space, said on Wednesday local time that it had received $1.5 billion from Softbank in advance because the company would run out of funds in a few weeks.

As a result, a series of company reforms of Wework have taken effect since Wednesday, including the removal of the chairman of the board originally held by co-founder Adam Neumann and the allocation of five board seats to Softbank, which will also receive a majority stake in Wework. Wework also said that Jeff sin, co-founder of rainegroup, a financial company, had been appointed as the new independent director.

This program enables the company to accelerate profitability, Marcelo Crowe, Weworks new executive chairman, said in a statement.

The $1.5 billion investment was announced in January this year and was scheduled for April 2020. As part of Softbanks rescue plan for Wework, the deal was accelerated to save Wework.

According to the prospectus released by Wework in August this year, the companys demand for capital is much higher than originally expected. According to the document, the division had $2.5 billion in cash reserves as at 30 June. But Wework is running out of money in November, which means it consumes about $6 billion a year.

In recent months, Wework has increased its spending, according to a person familiar with the matter who asked not to be named. The person said that Wework had expected the last three months of this year to be the first quarter of its listed companies, and hoped to show strong revenue growth by rapidly increasing office space.

Softbank plans to get the Committee on foreign investment in the U.S. to approve its rescue plan for Wework, according to people familiar with the matter. (Chen Chen)

Source: Wang Fengzhi, editor in charge of Netease Technology Report