WeWork Creditors Brace for Losses as Bankruptcy Case Starts
- Bankruptcy plan includes swapping billions in debt for equity
- SoftBank has long been the biggest investor in co-working firm
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WeWork Inc.’s first appearance in bankruptcy court on Wednesday kicked off a months-long process to decide how creditors should divide the remains of a once high-flying company that can’t afford to repay more than $4 billion it borrowed.
So far, court papers show that billions of dollars of the co-working firm’s debt will be converted into equity, while nearly all shareholders and owners of low-ranking bonds will be wiped out. US Bankruptcy Judge John K. Sherwood will decide in the coming months whether to approve a proposed restructuring deal WeWork struck with senior lenders and its leading investor, SoftBank Group Corp.