The agreement will merge WeWork with BowX Acquisition Corp., valuing it at $9 billion including debt. It will also raise $1.3 billion for WeWork, including $800 million from a private placement with investors including Insight Partners, funds managed by Starwood Capital Group, and Fidelity Management.

New York-based WeWork, co-founded by Adam Neumann and heavily backed by SoftBank Group Corp., was valued at as much as $47 billion two years ago. But plans for an initial public offering imploded in 2019 after investors raised concerns over the company’s business model and Neumann’s management style. WeWork’s valuation plunged to about $8 billion after SoftBank extended a financing lifeline to the startup. The flamboyant Neumann, known as much for his erratic behavior as for his innovative vision, was subsequently pushed aside.

The coronavirus pandemic took a further toll on the company’s prospects. WeWork’s business model consists of packing high volumes of workers into shared offices, an unappealing option for many people during a health crisis. WeWork has closed many locations, cut thousands of jobs and renegotiated leases in order to survive.

Read More: Adam Neumann Era of Excess and Eccentricity Over at WeWork

The agreement with BowX takes advantage of a wave of SPAC deals to achieve what Neumann couldn’t. Marcelo Claure, WeWork’s executive chairman and the chief operating officer at SoftBank, said in an interview early this year that multiple special purpose acquisition companies had approached WeWork after long being shunned by investors.

The deal is expected to close in the third quarter of 2021 and has been approved by both boards, according to a statement Friday. The deal was first reported by the Wall Street Journal.

WeWork, now led by Chief Executive Officer Sandeep Mathrani, said in November that its overall membership and revenue shrank in the third quarter compared with the quarter before. The company left 66 locations and re-negotiated lower rent, deferrals or other lease changes at more than 150 others, leaving it with 542,000 members across its 859 locations, Bloomberg reported at the time.

The company disclosed to prospective investors it had lost about $3.2 billion last year, the Financial Times reported earlier this week. The documents also show that occupancy rates fell to 47% at the end of 2020, down from 72% at the start of the year, before the pandemic hit, according to the newspaper.

In the interview in January, Claure argued the pandemic was helping WeWork. He said the work-from-home situation benefits the company and would continue to do so as people return to the workplace. “This is where WeWork suddenly becomes an incredible value proposition,” he said. “New habits have been developed during this pandemic.”

Mathrani will continue to lead the company after the deal. Vivek Ranadive of BowX and Insight Partners’s Deven Parekh will join the board.

BowX Acquisition Corp. is managed by Ranadive and Murray Rode, both former executives at TIBCO Software and co-founders of venture firm Bow Capital.