Wall Street firms, including BlackRock Inc
The decision emerged after WeWork expressed uncertainty about its ability to continue operations.
WeWork's stock has plunged 99% since the company went public in October 2021.
While the creditors have supported WeWork's filing for Chapter 11 bankruptcy, no formal proposal has been presented to the company's board.
The potential bankruptcy could permit WeWork to exit some of its costly commercial real estate leases, the Wall Street Journal noted.
It may also result in the creditors taking control of the company by offering them shares in the newly organized company.
Fund managers recently lent WeWork $1.2 billion, accounting for 50% of the company's long-term debt.
WeWork might avoid bankruptcy if it can negotiate with landlords to reduce rent costs.
WeWork's past saw rapid growth, once holding the world's most valuable startup title at $47 billion.
However, concerns about former CEO Adam Neumann led to the company's IPO cancellation in 2019.
WeWork has since downsized its workforce by half and attempted international expansion but hasn't reached profitability.
Their high rental costs have affected their ability to enhance member experiences.
The company has already made efforts to reduce fixed lease payments by amending or canceling many leases, totaling an estimated reduction of $12.7 billion.
Bankruptcy protection might be the company's answer to its approximately $25 billion lease obligations over the next decade.
Despite efforts to reduce losses, WeWork spent about $530 million in the first half of 2023 and now holds a mere $205 million cash reserve, with fears of running out due to increased member exits.
WeWork's 2027 bond trading indicates that full debt repayment is unlikely. Filing for bankruptcy could nullify WeWork's publicly traded stock, impacting significant investors like SoftBank Group Corp
SoftBank, one of WeWork's major shareholders, has continued accumulating company shares despite its changing fortunes.
The NYSE suspended trading in the warrants because of "abnormally low" trading price levels, WeWork said in an SEC filing.
Last week, WeWork announced a 1-for-40 reverse stock split to save its New York Stock Exchange listing.
The reverse stock split will go into effect at 4:01 p.m. New York time on Sept. 1 and begin trading post-split at the market open on Sept. 5.
Price Action: WE shares are down 1.96% at $0.13 during the premarket session on the last check Friday.
