(Bloomberg) -- WeWork Inc. is rounding up advisers for help with a restructuring as it struggles with a heavy debt load and poor financial performance, according to people with knowledge of the matter.
The co-working giant has hired real estate adviser Hilco Global, once again tapped consultant Alvarez & Marsal and re-engaged law firm Kirkland & Ellis for advice on its options, according to the people, who asked not to be identified because the matter is private. The company is seeking to avoid a Chapter 11 bankruptcy filing and restructure its debts out of court, one of the people said.
WeWork’s ability to stave off a bankruptcy filing will depend in large part on whether it can terminate or renegotiate a substantial number of its leases in more expensive markets, the people said.
“We will continue to invest in our product offerings while simultaneously taking necessary steps to reduce rent and tenancy costs. Our members remain our priority and, regardless of any near term actions we may take, we will continue to operate and serve them for the long term,” a representative for WeWork said in a statement.
Representatives for Hilco, Alvarez and Kirkland didn’t respond to requests for comment.
WeWork earlier this month told investors there is “substantial doubt” about its ability to stay in business. The company will focus over the next year on cutting rental costs, negotiating more favorable leases, boosting revenue and raising money, it said in a statement at the time.
The company went public through a combination with a special-purpose acquisition company in 2021. Its shares have plunged 97% in the last year, and its debt has fallen into deep distress, just months after it reached a sweeping debt-cutting deal with some of its creditors.
Earlier this month, WeWork added four restructuring specialists — Paul Aronzon, Paul Keglevic, Elizabeth LaPuma and Henry Miller — to its board.
--With assistance from Rachel Butt and Jeremy Hill.
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