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WeWork enters commitment letter with Goldman for $1.75B new financing

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WeWork enters commitment letter with Goldman for $1.75B new financing

WeWork Cos. Inc. and backer SoftBank Group Corp. entered into a commitment letter with Goldman Sachs Group Inc. whereby the embattled coworking giant will receive $1.75 billion in new financing, Bloomberg News reported, citing WeWork spokesperson Erin Clark.

Under the new deal, The We Co. unit will not be required to post any cash collateral, the news outlet quoted Clark as saying, adding that WeWork and Softbank are co-obligors on a senior secured and unsecured basis, respectively. Clark noted that WeWork will be able to access the facility starting in January 2020.

The new line of credit paves the way for SoftBank to arrange $5 billion of debt financing for WeWork as part of its previously agreed-upon bailout package. This should free up approximately $800 million in cash that the coworking company had earmarked to satisfy covenants on its previous credit line, Bloomberg added, citing two people familiar with the matter.