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18.03.2020

SoftBank won’t complete the deal with WeWork

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The Japanese conglomerate shares fell as much as 11% on Tuesday

Stocks impacted: SoftBank Group (9984)

SoftBank Group could walk away from a significant part of its WeWork bailout program. The surprise move comes as the coronavirus outbreak diminishes demand for the troubled company’s shared office space. As a reminder, the Japanese conglomerate had planned a $3 billion tender offer for WeWork shares, which were privately held, along with a $1.5 billion acceleration of equity it has already committed and $5 billion in syndicated debt. SoftBank Group Corp shares fell as much as 11% on Tuesday while its market capitalization dipped below the value of its domestic telco. Last week, SoftBank announced a $4.8 billion share buyback amid fragile markets. In response, S&P Global Ratings said raises questions over its commitment to financial management and prompted a revision in its outlook for the company to negative.

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