NEW YORK - Even in the wild tech start-up scene, Mr Adam Neumann stood out as a quirky, self-obsessed maverick with a reckless streak.

Which goes a long way in explaining why the current management at WeWork – the company Mr Neumann built into a US$47 billion (S$63 billion) real estate powerhouse before he was pushed out and it fell into bankruptcy – is not eager to pick up the phone when he calls to do business. Mr Neumann wants to slide WeWork a slug of cash to help it pay leases and legal fees and avoid liquidation – a move that, if accepted, would effectively put him back in control of the company he co-founded.

Some two months have gone by since Mr Neumann first reached out to WeWork and, his lawyers contend, he is still waiting on the necessary facts and figures to fine-tune and finalise his proposal.

“We write to express our dismay with WeWork’s lack of engagement,” Mr Alex Spiro, an attorney representing Mr Neumann, told WeWork’s lawyers in a letter.

The private letter’s public circulation on Feb 6 highlights the frustration growing in the Mr Neumann camp. But the truth is they have an increasingly strong hand to play as they seek to get WeWork, and the investors who control it, to the bargaining table.

A prior debt restructuring – a last gasp of sorts in early 2023 – put a handful of big time investors, namely SoftBank Group and King Street Capital Management, in control of the company’s highest-ranking debt. Those investors struck a tentative deal months ago to take over the company if it is able to renegotiate burdensome office leases.

But that plan has been clouded by doubts: A smattering of the company’s landlords, without whom it has no business at all, are ringing alarms about a lack of progress in the revival effort. So are low-ranking creditors. That means WeWork may not be in a position to refuse anyone looking to inject cash into the business, even if that person is the one who sowed the seeds of its insolvency to begin with.

“Adam Neumann’s grandstanding couldn’t come at a worse time for WeWork,” Mr Daniel Gielchinsky, founding partner of DGIM Law, said in an interview. “And if you just think about history repeating itself, Adam Neumann was ousted from this company for a reason. Putting him back at the helm of this company would almost certainly spell its demise in the long run.”

‘Painfully little progress’

WeWork has been in bankruptcy since early November with plans to re-negotiate hundreds of leases, many of which it says are simply too expensive. But that process has been less fruitful than expected, and a move to withhold rent from landlords who will not play ball has run into serious opposition.

US bankruptcy judge John K. Sherwood of New Jersey set a hearing for later in February to decide whether he will force WeWork to pay those landlords. But a panel of the lowest creditors in the pecking order is worried the company just doesn’t have the money to pay its bills, which would put the whole restructuring effort in jeopardy.

“We don’t want to see a truly, administratively insolvent estate,” said attorney Kris Hansen, who is representing WeWork’s official committee of unsecured creditors, speaking in bankruptcy court on Feb 5. In bankruptcy lingo, that refers to companies becoming so cash-poor that they cannot pay their lawyers and bankers in full, let alone junior creditors.

“There has been painfully little progress,” Mr Hansen said.

Enter Mr Neumann. His lawyer said he and his start-up have floated a US$200 million financing package to help WeWork keep paying for its restructuring, a sum that would help keep the lights on for at least a little while. Such financing typically sits at the very top of the repayment stack and would give Mr Neumann considerable sway in the outcome of the bankruptcy.

A Steve Jobs-like return to his creation would be in line with Mr Neumann’s brash personality. When he was running WeWork, he loved being the face of the company, often giving pump-up speeches at its Summer Camp festivals and all-hands gatherings.

Uncertain price tag

Mr Neumann has not yet provided even a roundabout dollar figure regarding what he would bid for the company, according to a person with knowledge of the matter. The company is willing to give Mr Neumann the access to information he needs to formulate a bid, the person said.

He may also need support from the company’s highest-ranking creditors. Long-time backer SoftBank Group and investment firms like King Street, Silver Point Capital and Brigade Capital Management own most of the company’s secured debt, according to court filings.

It is possible Mr Neumann has the resources to pull off a deal for WeWork, according to the Bloomberg Billionaires Index, which pegs his net worth at US$1.7 billion. That estimate does not include his stake in his new real estate venture Flow, which raised US$350 million from venture capital firm Andreessen Horowitz in August 2022 at a US$1 billion valuation. At least some of Flow’s residential properties were owned by Mr Neumann, and his stake in the company is not known.

“In a hybrid work world where demand for WeWork’s product should be greater than ever, my clients believe that the synergies and management expertise offered by an acquisition by my clients could significantly exceed the value of the debtors on a stand-alone basis,” Mr Neumann’s lawyer wrote in the letter. “WeWork should at least educate itself about that potential and not preclude itself from maximizing value.” BLOOMBERG