Reuters / Richard Brian
While speaking at the Robin Hood Investors Conference, billionaire activist Bill Ackman said SoftBank might have to write off its entire investment in WeWork, according to the Financial Times.
“I think WeWork has a pretty high probability of being a zero for the equity, as well as for the debt,” Ackman said, according to the FT.
He added: “As someone who has put good money after bad, I think this looks like putting good money after bad, and SoftBank should have walked away.”
Ackman also called WeWork co-founder Adam Neumann “an amazing salesman,” but said the company is still very leveraged, the FT reported.
The comments come about a week after SoftBank unveiled a plan to invest billions of dollars in WeWork to take control of the company and deliver a rescue deal before it ran out of cash.
The rescue deal came after the company withdrew its initial public offer and saw its valuation plunge from a peak of $47 billion.
Ackman founded Pershing Square Holdings, a hedge fund with positions in Starbucks, Lowe’s, and Chipotle, among others, as of June 30 data. The fund was up 48.9% year-to-date as of June 30, according to its website.
Pershing Square took major losses several years ago on a $1 billion bet against Herbalife, a multi-level marketing company.
