WeWork has been thrown a multi-billion-dollar lifeline from Softbank that will give the Japanese company more control of the troubled property start-up.

In a statement, Softbank said it would provide $5bn (£3.9bn) in new financing and up to $3bn for existing shareholders.

The deal will see Softbank increase its stake in the US office-space sharing start-up to roughly 80%.

Co-founder Adam Neumann will leave the board but retain “observer” status, reports BBC.

The deal marks the end of a tumultuous period for WeWork – once valued at nearly $50bn – that saw Mr Neumann step down as chief executive as questions over his leadership emerged.

The former boss is expected to be handed a sizeable payout. The Wall Street Journal reported the deal could see Mr Neumann receive nearly $1.7bn as he sells his shares in the company and through other fees.

Rescue deal

Under the agreement, Softbank will “accelerate” an existing commitment to fund $1.5bn, in addition to new financing and issuing a tender offer for existing shareholders.

The Japanese investment giant already owned about a third of WeWork.