S&P warns it could downgrade Nissan ratings over Ghosn scandal

S&P Global Ratings announced a ‘CreditWatch with negative implications’ on Nissan. (Kyodo News via AP)
Updated 20 November 2018

S&P warns it could downgrade Nissan ratings over Ghosn scandal

TOKYO: Ratings agency S&P warned Tuesday that Nissan faces a possible debt downgrade after its chairman Carlos Ghosn was arrested for alleged financial misconduct.
S&P Global Ratings announced a “CreditWatch with negative implications” and said it “also placed all of our ratings on Nissan’s overseas subsidiaries on CreditWatch negative.”
It warned the firm’s profitability could “weaken substantially” in fiscal years 2018 and 2019 if Ghosn’s alleged misconduct affected Nissan sales or hurt its alliance with Renault and Mitsubishi Motors.
It said any downgrade “is likely to be by one notch.”
“Although Nissan said it aims to identify its governance issues and hammer out preventive measures, we think rebuilding its management culture swiftly will not be easy.”
Auto titan Ghosn, who headed the automaker alliance, was arrested in Tokyo on Monday on allegations that include systematically under-reporting his income.
His detention marks a stunning fall from grace for the Brazil-born executive who is credited with resurrecting Nissan through bold restructuring measures.
Ghosn has yet to comment on the allegations against him. Nissan’s board is set to meet on Thursday to discuss dismissing him.


Struggling WeWork mulls bailout deals with SoftBank, JP Morgan

Updated 14 October 2019

Struggling WeWork mulls bailout deals with SoftBank, JP Morgan

TOKYO: Under-pressure start-up WeWork is considering two huge bailout plans including a cash injection that could see Japanese investment titan SoftBank take control of the firm, according to reports.
The office-sharing giant had been on course for a massive initial public offering until last month when questions began to be asked over its governance and profit outlook.
The firm’s valuation plunged from $47 billion in January to less than $20 billion in September and the listing plans have been dropped, while co-founder Adam Neumann stepped down as chief executive.
With New York-based parent company We Co. not expected to push for the IPO this year, the cash-strapped firm is looking for a financial lifeline.
The Wall Street Journal, New York Times and Bloomberg News cited unnamed sources close to the talks as saying SoftBank — the US firm’s biggest shareholder — had drawn up a proposal that gives it full control of WeWork.
The move would dilute the voting power of Neumann, who remains as chairman of the company he started in 2010 and also currently maintains control a majority of voting shares.
They also reported that WeWork is looking at a deal with Wall Street giant JP Morgan to raise $5 billion in debt, with the Times saying directors of We would be meeting as soon as Monday afternoon to discuss that.
“WeWork has retained a major Wall Street financial institution to arrange financing,” the Journal reported a company spokesman as saying.
“Approximately 60 financing sources have signed confidentiality agreements and are meeting with the company’s management and its bankers over the course of this past week and this coming week.”
The New York-based startup that launched in 2010 has touted itself as revolutionizing commercial real estate by offering shared, flexible workspace arrangements, and has operations in 111 cities in 29 countries.
However, the company, which lost $1.9 billion last year, has faced skepticism over its ability to make money, especially if the global economy slows significantly.