Briefing

SoftBank tells shareholders it doesn’t have to purchase US$3 billion in WeWork shares

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The Japanese firm notified WeWork shareholders it does not believe it needs to purchase the shares from existing investors, due to a number of ongoing investigations into the office-sharing firm. The move does not affect the US$5 billion SoftBank has already offered WeWork after it pulled back from its IPO. (The Wall Street Journal)

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Talking point: The notice does not guarantee SoftBank will pull its money, but it comes as the short-term-rental market is being hit hard by COVID-19 as a growing number of people work from home. If SoftBank pulls the US$3 billion, it’ll affect ousted WeWork CEO Adam Neumann, who secured the right to sell up to US$970 million in stock as part of the deal. SoftBank has received information from the U.S. Securities and Exchange Commission, the Justice Department and New York state officials regarding WeWork. The Japanese firm is facing a host of its own troubles outside WeWork, though. Its shares fell 10 per cent Wednesday to their lowest point since 2016. S&P Global cut SoftBank’s credit rating to negative earlier this week, following SoftBank’s announcement that it would buy back shares.