31–40 of 124 posts
Is this news about that second round funding by Softbank?
Quote: WeWork’s board said that it “regrets the fact that SoftBank continues to put its own interests ahead of those of WeWork’s minority stockholders.” Of course they’re going do to that, it’s called fiduciary duty to their own stakeholders! Such diligence is something WeWork’s board seemed to casually overlook for far too long. At this point why would SoftBank buy WeWork shares that are in all likelihood worth litt…
Not surprising, was wondering how SoftBank seemingly walked away so easily. If you are Softbank do you use this Covid crisis to back WeWork in to a corner even if their suit is legitimate as they might run out of cash before it reaches the courts? From what I understood SoftBank already owns a majority of WeWork so how does the company they own, suing them work?
Quote: WeWork’s board said that it “regrets the fact that SoftBank continues to put its own interests ahead of those of WeWork’s minority stockholders.” Of course they’re going do to that, it’s called fiduciary duty to their own stakeholders! Such diligence is something WeWork’s board seemed to casually overlook for far too long. At this point why would SoftBank buy WeWork shares that are in all likelihood worth litt…
Has anyone estimated how many months WeWork has until it collapses?
Last time I checked, WeWork was a going concern with 600,000 customers more or less happy with their service. What would tank them? Are their lease obligations too large and can't be renegotiated?
This entire thing is blown so far out of proportion. Like Tesla, it seems like a company that mostly makes products people like, whose equity is extremely hard to value. Maybe WeWork is worth $40 billion, maybe it's more like Regus and worth $4. This only affects you if you're a shareholder. As a WeWork customer, I absolutely couldn't care less about any of this nonsense.
I'm reminded of a classic finance quote: "If I owe you $100, I have a problem. If I owe you $100 million, you have a problem." This summarizes the dynamic between WeWork and its landlords right now.
Not surprising, was wondering how SoftBank seemingly walked away so easily. If you are Softbank do you use this Covid crisis to back WeWork in to a corner even if their suit is legitimate as they might run out of cash before it reaches the courts? From what I understood SoftBank already owns a majority of WeWork so how does the company they own, suing them work?
There is still a fiduciary duty to the minority shareholders by the majority shareholder
It's a fine distinction, especially when those roles are often exercised by an overlapping set of individual people, but it's the management as a collective agent of the shareholders that owes a fiduciary duty to all, including minority, shareholders. Shareholders, as such, do not owe each other or the firm a fiduciary duty.
SoftBank should hold out until WeWork crumbles under the weight of their terrible business model and the current crisis, then purchase their real estate assets for pennies on the dollar.
Earlier quoted context omitted.
> WeWork is renting so many square feet WeWork is big. CRE is huge. WeWork is not even among the top ten largest lessees in America.
Source for that? I’d be curious what the top ten are.
SoftBank should hold out until WeWork crumbles under the weight of their terrible business model and the current crisis, then purchase their real estate assets for pennies on the dollar.
Earlier quoted context omitted.
> it’s called fiduciary duty to their own stakeholders SoftBank has a fiduciary obligation to its shareholders. (Note: not all stakeholders. It has a duty to them. But it's not a fiduciary one.) It also has a fiduciary obligation to WeWork shareholders, by virtue of its Board seat. This case is, in summary, about how those duties conflict.
Conflict-of-interest is a human-invented notion that is rooted in the idea that the world is black and white, and it must be one or the other. That isn't the nature of how the rest of the universe operates. All that is needed is a weighting factor between the two loss functions (in this case, obligations) to deal with cases like this, and to make the policy (in this case, term sheet) continuous and differentiable as…
That doesn't seem like a particular relevant critique here; it's not like naturally occurring corporate boards or some universal law of fiduciary duty are things we've observed outside of humanity. Why shouldn't human-invented heuristics apply to situations that as far as we know only occur in human interactions?