NEW YORK (Reuters) – WeWork officials, including the co-founder and former Chief Executive, Adam Neuman, are being sued by minority shareholders to recover losses if the shared-workspace provider, withdrew its initial public offering and saw its value plunge by more than 87%.
FILE PHOTO: WeWork’s logo is displayed outside of a co-working space in New York City, New York, New York, USA on January 8, 2019. REUTERS/Brendan McDermid/File Photo
In a proposed class action filed in San Francisco Superior Court, a former WeWork employee, As There are accused, of the company and of the board of directors of a violation of its fiduciary duties to the minority shareholders of its.
The San Francisco resident accused the council of letting Japan’s SoftBank Group’s rescue and WeWork, by encouraging the participation of about 80% as much as 29% in a “fire-sale” prices, and the provision of a Construction in a $1.7 million exit package.
Softbank and its chairman Masayoshi Son are among the 10 named as suspects in the Nov. 4 the complaint, which also accuses them of, and Construction of self-treatment.
“WeWork is of the opinion that this lawsuit is meritless,” a spokesperson for the police said on Friday. They turned, and the party representatives, and There’s lawyer did not respond to requests for comment.
The charge is a new setback for WeWork, the New York-based parent company, the Company postponed its initial PUBLIC offering on Sept. 30 days after the investors grew wary of its losses, the business model and the corporate governance committee. Neumann had resigned the previous week.
Estimates of WeWork’s valuation has sunk to as much as $5.9 billion, according to the value of Softbank’s proposal of a $9.5 billion rescue of a $47-billion in the month of August.
WeWork, on Friday revealed plans to divest non-core businesses and cut jobs, and Construction, is the former chief of staff, called him the last week of the pregnancy non-discrimination act.
While shareholder lawsuits are most often associated with publicly traded companies, WeWork’s own status as a “no impact” on the merits of the case, said Michael Klausner, a corporate law and governance professor at the Stanford Law School.
He said he was a self-dealing claim, it is something that a judge will have to look at very carefully, and it may be difficult for defendants to dismiss.”
There it said that they are in a WeWork shareholders, while the employee was there for 1-1/2 years of age.
She said that she was following her voluntary departure, she exercised stock options, after being told WeWork is intended to get the public to move rapidly, and the value of the stock would have to increase significantly.
Instead, There he said the suspects caused a major decline in the stock’s value, and it threatened “irreparable harm” from Softbank and rescue, and other operations.
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The lawsuit aims to block WeWork in rubber-stamping any further transaction with Softbank, and Construction, and to reduce the stock of buy-back of the minority shareholders. It also seeks punitive damages.
Softbank’s proposed rescue includes a $3 billion to buy back the WeWork shares from existing shareholders, including as much as $ 970 million in Construction.
In the case, is There a v-Neumann et al., California Superior Court, San Francisco County, No. Corporate governance committee-19-580474.
Reporting by Jonathan Stempel in New York; editing by Jonathan Oatis and Sonya Hepinstall