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WeWork Faces Bankruptcy as Financial Troubles Mount

WeWork, the provider of shared office spaces, is reportedly on the verge of declaring bankruptcy. The company has announced to the US financial regulator that it has reached an agreement with its ‌creditors ​to temporarily defer‌ payments on some of its debts. The Wall ⁣Street Journal, citing informed sources, reported that WeWork is preparing to file for bankruptcy with creditor protection as early as ⁢next ​week. ‌Following this news, ​the company’s shares plummeted by more than 40⁤ percent.

WeWork became ‌a prime example of wildly ⁤overvalued​ American start-ups a few years ago, ‌according to the ‌DPA news agency. The company recently encountered problems ​again – in August, it admitted to having significant doubts about its future existence, citing losses and ⁢an expected need for funds.

On Tuesday, WeWork announced that it ‍had reached an additional weekly ⁢deferral ⁣agreement with its supporters for further negotiations. When ⁢the company failed to ⁣repay its outstanding amount‌ at the beginning of October, a 30-day grace period began, after which a decision​ could ‍be​ made ‌on its‌ insolvency.

WeWork’s ‌business model is to rent shared office spaces with​ shared infrastructure to aspiring entrepreneurs in so-called co-working spaces. Thanks to clever ⁢marketing, the company’s founders attracted sponsors who invested $47 billion (over a trillion⁢ Czech‍ crowns) into the company.

WeWork wanted to⁢ go public in 2019, aiming to ⁣become one of the most valuable start-ups. However, the company faced a setback as a deep insight into⁢ its⁣ business in the prospectus for the initial public offering (IPO) caused major investors to steer clear of its losses. The pandemic further hit ​the company⁣ hard as COVID-19 measures forced people to work from home instead of shared spaces.

In 2021, WeWork went public, but ⁣only through a merger with a special purpose ‍acquisition company (SPAC). Even now, the company’s stock price is valued at approximately $120 million.

WeWork has a branch in ​Prague, located in the Drn office center on Národní třída.

What factors led to WeWork’s financial instability and potential ⁤bankruptcy filing?

WeWork, ⁤the ​renowned⁢ provider of shared office spaces, is reportedly on the brink of filing for ⁢bankruptcy. Recently, the company revealed to the ⁣US financial regulator that they have successfully negotiated an agreement with their creditors.

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