WeWork members at the building on London's Southbank have been asked to vacate by November 30
Troubled co-working company WeWork is planning to close some of its buildings globally as part of its efforts to ''improve liquidity and strengthen its balance sheet'', BBC reported. WeWork members at the building on London's Southbank told the BBC that they had been emailed by the company telling them it was closing ''unprofitable'' sites. They were asked to vacate the building by November 30 and WeWork had said it would find them "alternative workplace solutions".
Meanwhile, the company's shares plunged 37% after the company revealed plans to file for bankruptcy as early as next week, as per CNN. Earlier on Tuesday, WeWork said it had agreed with creditors to extend a 30-day grace period to make interest payments on some of its debt that was due to expire this week. The new “forbearance agreement” will terminate on November 6, according to a timeline provided by the company.
A few months ago, US-based WeWork Global made a statement that "substantial doubt" exists about the company's ability to continue as a going concern. Its major backer, Japanese conglomerate SoftBank, invested tens of billions to prop up the startup, but the company has continued to lose money.
However, WeWork India on Wednesday asserted this will have no impact on its business, saying the Indian business is backed by realty firm Embassy Group and has achieved consistent growth. WeWork India has 50 centers, covering 6.5 million square feet area across 7 cities -- New Delhi, Gurugram, Noida, Mumbai, Bengaluru, Pune, and Hyderabad.
In a statement on Wednesday, WeWork India CEO Karan Virwani said, "WeWork India is a separate entity from WeWork Global. The recent news around the potential bankruptcy and Chapter 11 filing in the US will have no impact on the members and stakeholders in India."
WeWork's filing for bankruptcy would mark a stunning reversal of fortune for the company, privately valued at $47 billion in 2019. The company has been trying to turn the page on Adam Neumann, its co-founder and former leader whose antics tired investors. The company has been in trouble since Mr Neumann's forced departure in late 2019 following WeWork's failed IPO, in which the company's valuation fell from $47 billion to less than $10 billion.
WeWork has been a celebrated star in the sharing economy that put a mammoth footprint in the commercial real estate of major cities around the globe.