WeWork co-founder Neumann sues SoftBank over failed deal

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WeWork co-founder Neumann sues SoftBank over failed deal

Late on Monday, the 4th of May 2020, Adam Neumann, the former Chief Executive of the office-space sharing start-up WeWork, had filed a lawsuit in a Delaware court against the Japanese investment conglomerate SoftBank Corp.

alongside its Vision Fund, accusing the investment behemoth of wrongfully terminating a $3 billion tender offer to the WeWork shareholders. As a matter of fact, after WeWork had backed away from a planned IPO later on September last year, the office-space sharing startup had faced off a steep lack of capital to keep it operational, while the SoftBank Corp.

came up with a $9.6 billion rescue package including the $3 billion tender offer for the startup in October last year. Nonetheless, since SoftBank’s acquisition of WeWork, the office sharing start-up’s occupancy rate had pummelled to a record low, while the ongoing pandemic had added to further cratering.

Amid such pessimistic outlook, SoftBank said in a statement last month that it had decided not to forge ahead with the tender offer adding that a number of pre-conditions had not been met, which eventually had deprived WeWork’s minority stakeholders alongside Neumann of a payoff.

Meanwhile, as the former Chief Executive of luxury handbag manufacturer Coach, Lew Frankfort, alongside a general partner of WeWork shareholder Benchmark Capital, Bruce Dunlevie, had also filed separate a lawsuit on common cause against the Japanese investment tycoon, Neumann’s lawsuit filed in a Delaware court on Monday (May 4th) said, “The abuses committed by (SoftBank) and SBVF (SoftBank Vision Fund) are so brazen that they have prompted legal action by a special committee of WeWork’s board. ”