Former Hollywood production powerhouse the Weinstein Company announced Monday their plans to file for bankruptcy after a last-minute deal to salvage the studio fell apart; ending months of speculation about the future of the business following Harvey Weinstein’s shocking sexual revelations.
From New York Times:
LOS ANGELES — The Weinstein Company said that it would file for bankruptcy following the collapse of sale talks with an investor group, extending the damage from sexual misconduct allegations against Harvey Weinstein, its co-owner and a onetime force in Hollywood.
The beleaguered film and television studio said in a statement late Sunday that it had failed to reach a deal with a group led by Maria Contreras-Sweet, who ran the Small Business Administration under President Barack Obama. The group had offered to pay roughly $275 million for the Weinstein Company, plus the assumption of $225 million in debt.
“While we recognize that this is an extremely unfortunate outcome for our employees, our creditors and any victims, the board has no choice,” the company’s statement said. “Over the coming days, the company will prepare its bankruptcy filing with the goal of achieving maximum value in court.”
The Weinstein Company board, a three-member group that includes its co-founder Bob Weinstein, also released a sharply worded letter it sent earlier on Sunday to Ms. Contreras-Sweet and one of her primary backers, Ron Burkle, the billionaire investor. In the letter, the board members said they had worked “tirelessly” in recent days to meet “virtually every demand you imposed,” including waiving a breakup fee if a deal was not consummated.
However, Ms. Contreras-Sweet’s team, according to the letter, had not come through with promised interim funding to keep the 150-employee studio operating while a deal was completed. The letter also said that she had proposed new sale conditions that could add “many months (or longer)” to the closing process.
“Late last night, you returned to us an incomplete document that unfortunately does not keep your promises,” the letter said. “That is regrettable, but not in our power to change.”
Representatives for Ms. Contreras-Sweet’s team did not respond to a request for comment.
The Weinstein Company’s eventual bankruptcy comes as law enforcement prepares to press charges against disgraced Hollywood big wig Harvey Weinstein; claiming the high-powered executive sexually assaulted multiple women in New York, Los Angeles, and London.