People close to WeWork have confirmed to Fast Company that Japan’s SoftBank Corp. will invest an additional $2 billion in the shared workspace company.
The investment will be structured as a $1 billion primary investment and a $1 billion repurchase of shares from employees and existing investors, Fast Company has learned.
As a result of the new capital, WeWork’s investors will value the company at $47 billion, up from $42 billion pre-money.
The deal, while significant, is considerably less than a $10 billion infusion WeWork and SoftBank had discussed as recently as mid-December, a person close to the company said. (News reports in October pegged the negotiations at the $20 billion level.) At one point during deal talks, SoftBank reportedly sought a controlling stake in the company. But roiling markets and economic uncertainty have hit WeWork and its largest investor. Since the beginning of December, SoftBank’s stock price has dropped nearly 20%. At the same time, a highly anticipated IPO of its Japanese telecom business has flailed, sinking over 14% on its first day as a public company–one of the worst first-day declines in Japan.
The new investment brings SoftBank’s commitment to WeWork to more than $10 billion, including investments in WeWork China, a joint venture.