Fitch downgrades WeWork

Fitch Ratings said it downgraded WeWork Cos., LLC and WeWork Inc.'s, collectively WeWork, long-term issuer default ratings to CC from CCC- following weaker than expected second quarter financial results, a public warning that its ability to continue as a going concern over the next 12 months will be contingent on improving its liquidity, resignations of key executives and board members and the replacement of board members with restructuring experts.

The agency also cut the first-lien bonds to CCC-/RR3 from CCC/RR3 and affirmed its second-lien and unsecured bonds at C/RR6.

“In its previous rating action commentary in May, Fitch stated that WeWork's adequate liquidity depended on the company's continued improvement in operating performance. However, the necessary improvements have not materialized and WeWork continues to burn through cash. As of March 31, 2023, the company reported $422 million of cash on the balance sheet, which was down to $205 million as of June 30, 2023,” the agency said in a press release.

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