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Adam Neumann, the flamboyant co-founder of WeWork, and SoftBank, the Japanese conglomerate that rescued the co-working company in 2019, have made significant progress in recent weeks in resolving their long-standing legal dispute, according to two people familiar with the question. This battle stalled SoftBank’s efforts to go public with WeWork.

As part of its multibillion-dollar bailout of WeWork, SoftBank offered to pay $ 3 billion for the shares held by Mr. Neumann and other shareholders. Several months later, after the coronavirus pandemic emptied WeWork’s sites, SoftBank withdrew the offer. Mr. Neumann then sued SoftBank for breach of contract.

SoftBank was already a big investor in WeWork when it withdrew its plans for an initial public offering in 2019. Now SoftBank is considering combining WeWork with a publicly traded special-purpose acquisition company, a type of deal that is recently has become a popular way to quickly bring private companies to the stock market. The legal dispute between Mr. Neumann and SoftBank is a threat to such a deal because it leaves the question of SoftBank’s control over WeWork unanswered.

The settlement talks, which were reported earlier by the Wall Street Journal, could still collapse, the two said. Under the terms being discussed, SoftBank would buy half the number of shares it originally agreed to, one of the people said. As a result, he would pay $ 1.5 billion, not $ 3 billion. Mr Neumann would receive almost $ 500 million instead of almost $ 1 billion, but he would keep more of his shares.

Under Mr. Neumann, WeWork grew at a breakneck pace and was using so much cash that it was close to bankruptcy before SoftBank stepped in. Under the management team installed by SoftBank, WeWork has attempted to cut costs by slowing growth and negotiating deals with the owners whose space it leases.



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