WeWork is now one step away from junk-bond market’s weakest tier

WeWork bondholders are not taking kindly to the co-working giant’s move deeper into junk status.

The company, now officially called We Co., saw its 7.875% bonds due 2025 fall 2.75 cents on the dollar to 88.25 cents as of 11:12 a.m. in New York. The yield topped 10% for the first time since March yesterday in late trading, and floated even higher this morning.

S&P Global Ratings reduced WeWork’s credit rating one notch to B- with a negative outlook, putting it at the edge of the market’s weakest tier of borrowers. S&P could cut its credit rating again in the next year if the company struggles to get more financing, analysts wrote in a note.