The Weinstein Company is likely up for grabs. Mark Von Holden/Getty Images
Earlier this month, it looked as if The Weinstein Company would manage to stay afloat with a cash infusion from Colony Capital. Now, that doesn’t appear to be the case as Tom Barrack has backed away from the deal. Obviously, The Weinstein Co’s reputation has been tarnished due to the ongoing sexual harassment scandal. And while the studio wasn’t producing hits like it used to, it still boasted a Best Picture nominee in every Academy Awards since it launched in 2005. So there is some value there. The question now becomes how the company will move forward and who will swoop in to save it?
TheWrap reports that an estimated $300 million sale is expected to be completed by the end of November. It’s worth noting that brothers Harvey and Bob Weinstein own 42 percent of the company. According to the outlet, there are 22 prospective buyers including Ron Burkle’s Yucaipa, Viacom, MGM and Lionsgate. Harvey has already been fired by the company’s board, but a condition of the sale is said to be the resignation of Bob, who serves as Co-Founder and Dimension Films President, as well. Bob was also recently accused of sexual harassment.
The sale is being handled by Moelis & Company Managing Director Carlos Jimenez on behalf of the TWC board.
Barrack’s Colony Capital had originally pledged $35 million in emergency funds, but have since withdrawn their interest. Instead, Fortress Investment Group has provided the cash infusion. Barrack had initially offered $175 million for the company, which the board rejected. Prior to the sexual harassment scandal, TheWrap reported that TWC was valued between $400 million and $500 million. In addition to Dimension, The Weinstein Company has also begun to branch out into television, develop fashion holdings and recently launched an animation division.
Following Colony’s reversal last week, one investment banker told TheWrap that bankruptcy would be the only way to “cleanse the asset” and that a reorganized sale would be necessary. We’ll have to wait and see if that’s how things shake out.
Can The Weinstein Co (name change forthcoming) be salvaged?
