Speculation has reigned, including in these pages, that the ever unfolding disaster that is WeWork had chastened SoftBank CEO Masa Son. That paying $15 billion for a controlling stake in a $5 billion-and-sinking office subleasing boondoggle had destroyed his whimsy, made him unable or unwilling to make the kind of challenging artistic decisions that have defined his oeuvre.
Son has done a good deal in recent weeks to dispel at least part of that fear, including pulling another 11-figure disaster out of the fire, an audacious $41 billion stock buyback and debt reduction plan, and, oh yea, telling the aforementioned company it controls that he won’t be bailing out its founder, early investors and current and former employees to the tune of an additional $3 billion. This, Son said, was because WeWork had failed to meet the conditions set for the tender offer by the April 1 deadline, notably due to a host of new investigations by, well, everyone, lack of antitrust approvals and the failure to complete its takeover of its Asian joint venture. And the latter, according to a special committee of WeWork’s board, is because Son made damned sure it didn’t happen.
“Son and other SoftBank executives had discussions with certain ChinaCo minority investors and used their influence over those investors to convince them not to waive certain first refusal and co-sale rights,” WeWork’s special committee argued in a court filing. “The practical effect of the investors’ non-waiver was that the roll-up of ChinaCo could not be completed in accordance with the MTA, preventing a condition to the Tender Offer from being satisfied. SoftBank took these actions despite its contractual obligation to use reasonable best efforts to effectuate the roll-up.”
That’s right, a court filing, because in his latest and arguably boldest piece of financial performance art, Son has allegedly arranged to essentially be sued by himself, in the form of a company that he alone is keeping alive. It’s a breathtaking act of defamiliarizing nihilism that will hopefully be performed in the Museum of Modern Art once it reopens.
WeWork board sues SoftBank over withdrawal to buy $3 billion worth of shares [CNBC]
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