Proactive Investors - WeWork Inc (NYSE:WE) shares sank as much as 14% in pre-market trading on Friday after the flexible office space provider announced plans for a 1-for-40 reverse stock split of its outstanding shares of Class A common stock and Class C common stock.
The reverse stock split will go into effect at 4:01 PM EDT on September 1, 2023, and begin trading on a post-split basis at the market open on September 5, the company said in a statement.
The reverse split is being effected primarily to increase the company’s per share trading price and to regain compliance with the $1.00 per share minimum closing price required to maintain continued listing on the New York Stock Exchange.
Shares of WeWork have lost 99%, or about $9 billion, in market value since the company went public in October 2021.
On August 8, the New York-based company warned it may have to file for bankruptcy as it has been losing money for years and has seen membership cancellations increasing.
Four years ago, WeWork was the largest private occupier of office space in Manhattan and London but was dealt a severe blow by the pandemic, which forced people to work from home, a trend that has been slow to reverse.