SoftBank posts £5.55bn loss from WeWork

SoftBank has made a £5.55bn loss (¥720.8bn) on its investments into WeWork for the year ended 31 March. In the Japanese banking giant’s latest financial results, SoftBank reported it had pumped a total of $10.3bn (£8.5bn) into WeWork over the course of the year. It is also revealed that $4.4bn had been wiped off the value of its investments into the flex space giant between 31 December  2019 and 31 March 2020. “The fair value of WeWork’s entire equity, calculated using the income approach (discounted cash flow method), was $7.3bnn as of December 31 2019 and $2.9bn as of March 31 2020,” SoftBank said, citing Covid-19 as a reason for the decline. It marks a disastrous year for the flex space giant, which failed to go public and formally pulled the plug on its initial public offering in September last year. By the end of the month, WeWork’s entire equity had decreased to $7.8bn (£6.44bn), SoftBank said. Troubles with WeWork are not yet over for SoftBank. WeWork directors are suing shareholder SoftBank for backing out of a planned purchase of $3bn (£2.4bn) of WeWork stock. The $3bn tender was part of a multi-billion-dollar rescue package that SoftBank put in place as WeWork teetered on the brink of insolvency last year. The collapse of the offer will also deny WeWork $1.1bn of debt, which was conditional on the offer. SoftBank lost a total of ¥1.9tn ($17.7bn) from all its investments, including Uber and hotel group OYO. To send feedback, e-mail lucy.alderson@egi.co.uk or tweet @LucyAJourno or @estatesgazette