WeWork Cos. sold $702 million in bonds Wednesday, becoming the latest startup to win over debt investors despite a cash-burning history that is atypical for a bond issuer. Bond investors are typically nervous about lending to companies that don’t generate stable cash flows. Unlike equity investors, bond investors reap limited rewards if a young company goes on to great things, but face ample downside if the business can’t make its interest payments. “Traditional credit metrics don’t apply here.”In a document presented to bond investors, WeWork offered some unusual measures of its earnings before interest, taxes, depreciation and amortization last year. After a rough patch earlier this year, the high-yield bond market has recovered of late, with risk premiums falling to near their lowest levels since the financial crisis.

Source: Wall Street Journal April 25, 2018 21:00 UTC