WeWork in Trouble After Missing Interest Payment
Oct 3, 2023 By MarketDepth
WeWork (WE:NASD) missed its latest interest payment which was $37.3 million cash and $57.9 million in interest. The company does have 30 days before the missed payment is considered a default but has sent the stock tumbling over 20% on the day.
“Entering the grace period is intended to allow discussions with certain stakeholders in the company’s capital structure to commence, while also enhancing liquidity as the company continues to take action to implement its strategic plan. As part of this strategic plan, the company is focused on rationalizing its real-estate footprint, and improving its capital structure.”WeWork said in a filing
WeWork has been struggling to get a handle on less profitable leases and trying to navigate the changes the pandemic put onto the need for office space. The company’s main focus is to negotiate all current leases to get more favourable terms for the company. The company did disclose they do have the liquidity needed to make the missed payment but will do them at a future date.
WeWork stock is down 20% on the day and 95% on the year as the company struggles to get there balance sheet under control.