WeWork co-founder Neumann sues SoftBank over failed tender offer

FILE PHOTO: Adam Neumann, chief executive officer of U.S. co-working firm WeWork, speaks during a signing ceremony in Shanghai, China April 12, 2018. Picture taken April 12, 2018. Jackal Pan via REUTERS/File Photo

WeWork co-founder Adam Neumann filed a lawsuit against Japan’s SoftBank Group Corp and its Vision Fund on Monday for terminating a $3 billion tender offer to the office-sharing startup’s shareholders.

The tender offer was part of a $9.6 billion rescue financing package that SoftBank agreed with WeWork in October and gave it control of the company. Since then, WeWork’s occupancy rates have plummeted amid the COVID-19 pandemic.

In April, SoftBank said it would not press ahead with the tender offer because several pre-conditions had not been met, frustrating WeWork’s minority shareholders, who were expecting a payout. The investors included Adam Neumann.

“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,” the lawsuit filed in a Delaware Court said.

An independent special committee, comprised of Bruce Dunlevie, who is a general partner at WeWork shareholder Benchmark Capital, and Lew Frankfort, former CEO of luxury handbag maker Coach, had also filed a lawsuit, calling SoftBank’s decision to terminate the tender offer wrongful.

SoftBank’s lawyers had questioned the special committee’s right to represent minority shareholders, an assertion the committee rejected last month.

“In real time, SBG (SoftBank) and SBVF (SoftBank Vision Fund) are abusing their control of WeWork in an effort to stop the special committee’s meritorious lawsuit from being heard,” the lawsuit said.

Meanwhile, SoftBank’s Chief Legal Officer Rob Townsend called Neumann’s claims “meritless”. Under the terms of the agreement, he said, SoftBank had “no obligation” to complete the tender offer in which Neumann – the biggest beneficiary – sought to sell nearly $1 billion in stock.

Reuters

 

Singapore Reporter/s

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Following vacancies can be applied for (only in Singapore).   

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.