WeWork, the office-sharing company once valued at $47B, files for bankruptcy protection

WeWork, the office-sharing company once valued at $47 billion, has filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of New York on Tuesday. The company had been struggling financially for quite some time, and the pandemic has added to its woes. The company's parent firm, The We Company, will present a restructuring plan to the court that will allow it to reduce its debt by more than $7 billion and receive a capital injection of about $1.75 billion. The restructuring plan will also convert approximately $5.7 billion of debt into equity. WeWork CEO Sandeep Mathrani said in a statement that the Chapter 11 filing “will enable us to significantly reduce our debt, finalize our vision for a more focused WeWork, and begin the process of building a very bright future for our company and the millions of people around the world whose businesses, passion, and livelihoods are supported by WeWork.” While this will provide a financial lifeline to the company, it will also inevitably result in layoffs and other consequences as WeWork tries to make its business model more efficient. It is not yet clear when and how the restructuring plan will be finalized and what the future holds for WeWork and its employees.