Weinstein Co., the New York studio co-founded by Harvey Weinstein, will file for bankruptcy protection after last-ditch talks to sell its assets to an investor group collapsed, the company’s board of directors said Sunday night.
“While we recognize that this is an extremely unfortunate outcome for our employees, our creditors and any victims, the Board has no choice but to pursue the only viable option to maximize the company’s remaining value: an orderly bankruptcy process,” the board said in a statement.
The decision came after the board was unable to revive a deal to sell the struggling studio to an investor group led by Maria Contreras-Sweet, who ran the Small Business Administration under President Obama from 2014 to 2017.
The bid, backed by billionaire investor Ronald Burkle and Dallas private equity firm Lantern Asset Management, would have given Contreras-Sweet’s consortium control of Weinstein Co.’s assets in a deal worth about $500 million. Their bid promised a new era for the once high-flying studio that has been in a tailspin since allegations against Harvey Weinstein shook the entertainment industry to its core more than four months ago.
Under the proposed deal, Weinstein Co. was to be renamed under a new board of directors, the majority of which would be composed of women. The bidders had promised to raise at least $40 million for a fund to compensate Weinstein’s accusers.
But the discussions came to a sudden halt Feb. 11 when the New York attorney general’s office filed a civil rights lawsuit against Weinstein Co. and its co-founders. The following day, Atty. Gen. Eric Schneiderman blasted the proposed sale and questioned the existence of the promised victims fund based on documents he’d reviewed.
Schneiderman also sharply criticized Weinstein Co. Chief Operating Officer David Glasser, whom he accused of not adequately responding to women’s complaints about Weinstein. Glasser had been positioning himself to become chief executive of the new company.
The board, which includes Harvey Weinstein’s brother, Bob, fired Glasser “for cause” Feb. 16 in an effort to salvage the deal talks. Glasser last week threatened to sue for wrongful termination.
On Wednesday, Contreras-Sweet and Burkle met with Schneiderman in Manhattan to discuss a compromise that would allow deal talks to progress.
(Excerpt) Read More in: Los Angeles Times