As for the reasons for the loss, Softbank said that it was mainly due to the huge loss of its vision funds investment projects.
According to financial data, soft bank vision fund lost as much as jpy1.9 trillion in fy19f, while its profit in the same period of 2018 was jpy1.26 trillion. In the fourth quarter of 2019 alone, vision fund lost 1.1 trillion yen in investment.
After a series of things, such as announcing the formal withdrawal of the prospectus from the SEC in October 2019, indefinitely delaying the IPO, a sharp fall in the valuation of up to $47 billion, the departure of the founder, and the reorganization of business and personnel, the company, once considered as one of the ancestors of Unicorn companies in the United States, has yet to get out of the dilemma.
At the time, Reuters reported that Softbank group needed to make technical amendments to the tender offer documents, so the tender offer was slightly delayed. Under a previous agreement between Softbank and Wework, Softbank agreed to a $9.5 billion plan to save Wework. Including the purchase of about $3 billion worth of shares from shareholders of the company, Softbanks purchase price is the lowest since 2015. In addition, Softbank provided $6.5 billion in debt and equity financing to the company. At that time, Softbank also planned to exchange shares of Weworks joint venture, that is, all the rights and interests of vision fund, a regional joint venture of Softbank, except for the Japanese joint venture, will be exchanged for shares of Wework at a price of US $11.6 per share. After all the transactions are completed, Softbank will acquire about 80% of the equity of Wework, and the share exchange plan should have been completed on April 1.
Since then, Softbank has decided to give up the US $3 billion tender offer for Wework, which is undoubtedly a major blow to Wework, which is still suffering from capital chain crisis. Because only after Softbank completes the acquisition can we work get $1.1 billion in debt financing from Softbank.
After Softbank decided to terminate the tender offer, Neumann, who is still the co-founder and director of Wework, chose to sue Softbank group because of its termination of the US $3 billion share buyback offer to Wework shareholders. In the lawsuit, Neumann accused Softbank and its Softbank vision fund of secretly taking action to destroy the subscription agreement before formally announcing the abandonment of the share buyback offer on April 1. Neumann has filed a lawsuit with the Delaware Court on May 4.
Softbank will actively defend itself against these baseless allegations, rob Townsend, Softbanks chief legal officer, said in a statement. According to the terms of the agreement signed by Adam Neumann and us, Softbank is not obliged to complete Mr. Neumann, the biggest beneficiary of this stock acquisition transaction, and seeks to sell nearly $1 billion of shares.