U.S. co-working startup WeWork has strengthened its foothold. The firm has secured an additional funding from Japan’s Softbank Group Corp of $3 billion.
The latest funding has come in the form of a warrant. Under the agreement, Softbank will pay WeWork $1.5 billion on January 15 and the remaining amount on April 15, ET Realty reported.
SoftBank agreed to pay $3 billion to WeWork in return of shares before September 2019 at a price of $110 per share or higher, depending on whether the startup goes public.
Softbank is by far the biggest investor in WeWork, which was founded in 2010 to run shared office spaces.
Earlier this year in July, WeWork has declared that it has raised $500 million from investors, including Temasek Holdings and SoftBank Group Corp. The talks for another investment from Softbank was going on since October. It is also said that SoftBank, which runs the world’s biggest private equity fund, was in discussions to buy a majority stake in WeWork.
Contrary to the popular beliefs, the start up Work had reported a major loss when it released its first-ever financial results in August. In the report, the privately held firm said its net losses jumped to $723 million over the first half of 2018 from $154 million a year earlier.
The loss-making startup and the Japanese’s Softbank are closely entwined, with hundreds of latter’s staff using space at the two companies’ Japanese joint venture.
Last month, the firm took a huge step in India when it leased out 0.5 million sq. ft office space, the largest deal by a co-working company in India. The space was leased across four locations in MMR and Bangalore.