WeWork CEO David Tolley Resigns as the Firm Emerges from Bankruptcy

WeWork's CEO, David Tolley, decided to step down after the company emerged from bankruptcy on Tuesday. This marks the end of the company's restructuring process that led to the closure of the company at several locations.

According to a report by Reuters, the company has now appointed John Santora as its new CEO. Santora previously held the position of Tri-State chairman at the global real estate services firm Cushman & Wakefield.

The workspace provider was once considered the most valuable startup in the US. It grew rapidly but faced heavy losses owing to costly leases and a sudden drop in demand during the pandemic. This had pushed the company to file for bankruptcy in November 2023.

Recently, a U.S. bankruptcy judge approved WeWork's restructuring plan, which allowed the elimination of $4 billion in debt. As per the report, the company's equity will be transferred to a consortium of lenders and real estate technology firm Yardi Systems.

WeWork was a major investment for SoftBank Group, with the latter holding nearly 71 per cent of its stake as of last November, despite having written down much of its investment over time.

Following the bankruptcy proceedings, SoftBank was expected to maintain a minority stake in the company due to the loans it extended.

WeWork also witnessed a sharp decline in its valuation as the estimated post-bankruptcy equity is only around $750 million, this figure once stood at $47 billion.

Tolley started out at WeWork as a board member in February 2023, but quickly stepped up as CEO by October. He led the company through a turbulent time, making big changes to how things were done.

During his time in charge, WeWork made some major moves, like scaling back its real estate holdings, renegotiating lots of leases, and shutting down over 170 locations that weren't making any profits for the company.