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Troubled real estate company WeWork is reportedly negotiating with a group of lenders led by JPMorgan Chase & Co. (JPM) - Get JPMorgan Chase & Co. Report to borrow $5 billion.

Bloomberg reported the news, which it said came from two people familiar with the talks. The co-workspace company needs cash desperately or it may run out before December, sourcesknowledgeable about the matter told Bloomberg.

WeWork had to scotch its initial public offering last month amid concern about the company's business model, its huge losses and self-dealing and erratic behavior by WeWork's co-founder Adam Neumann. 

The company had expected a successful IPO and a $6 billion loan that would have followed to bring in the cash it needed.

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A high-yield bond issue could constitute $3 billion or more of the debt package, sources familiar with the situation told Bloomberg. An agreement on broad terms of the borrowing could be reached next week. 

WeWork's bonds soared to record gains on news of the financing talks. Its senior unsecured notes due in 2025 climbed more than 8 cents, reaching 90.50 cents around 2:30 p.m, according to Trace bond trading data.

In a reflection of the company's woes, WeWork announced Friday that it will shutter its Manhattan elementary school after this academic year to cut costs and concentrate on its office-rental business.

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This article is commentary by an independent contributor. At the time of publication, the author held TK positions in the stocks mentioned.