Japanese technology giant SoftBank has committed billions of dollars to bailing out office-space sharing startup WeWork in a daring vote of confidence from its intrepid founder Masayoshi Son.
WeWork’s woes are substantial enough that some analysts say they could derail the investment ambitions of SoftBank’s mammoth Vision Fund.
WeWork is the dominant coworking player in Boston, comprising 3.2 percent of tenancy across the 72 million-square-foot office market, and it maintained its aggressive growth strategy during the third quarter.
Softbank will dish out $5 billion in new financing for WeWork and launch a tender offer of up to $3 billion for existing WeWork shareholders.
“The IPO debacle around WeWork was a very public setback for his Vision Fund and has given ammunition to all his doubters to scream, ‘told you so.
Lane rated SoftBank as an “outperform,” noting the deal ensures WeWork is an affiliate, not a subsidiary of SoftBank.
“We continue to believe that WeWork is fundamentally an attractive business with good long-term growth prospects,” he said.5 billion in funding for WeWork.