Colony Capital has less than two weeks to buy the Weinstein Co. as studio hangs in the balance
The future of the Weinstein Co. could be decided in less than two weeks as the company tries to stay afloat amid allegations of sexual abuse against its disgraced co-founder Harvey Weinstein.
Thomas Barrack’s private equity firm Colony Capital has about a week and a half to decide whether to buy the assets of the beleaguered mini-studio, said people close to the situation who were not authorized to comment. Colony, which gave the film and television company a financial lifeline last week, is in the midst of a due diligence process, these people said.
Bob Weinstein, now his namesake company’s lone chairman, is not expected to remain at the firm after a sale to Colony, people familiar with the matter said. The younger Weinstein had initially said the company was not for sale and was maneuvering to retain a leadership role in the business.
The Weinstein Co, known for movies including “The King’s Speech” and “Django Unchained,” was struggling with a lack of box office hits even before its former co-chairman was accused of sexual harassment and assault. Weinstein was fired by the company’s board on Oct. 8. More than 50 women have accused the producer of misconduct.
Bankruptcy or liquidation may await if no deal is reached with Colony or another buyer. People close to the company said it has enough capital to survive through the end of the year. If Colony decides against buying the Weinstein Co., there are about 20 serious potential investors waiting to swoop in, one person said.
The Weinstein Co. is hoping to avoid the fate of Relativity Media, which is now essentially defunct after declaring Chapter 11 bankruptcy protection in 2015. The once high-rolling studio founded by Ryan Kavanaugh said it had secured investors and had multiple buyers waiting in the wings as it stood on the edge of collapse. Now Relativity is a ghost of its former self.
Representatives for the Weinstein Co. and Colony Capital did not immediately comment.
Colony previously bought movie studio Miramax — the first studio founded by Harvey Weinstein and his brother, Bob — with a team of investors in 2010. The brothers had left by 2005 after an acrimonious relationship with parent company Disney. Colony sold Miramax to a Qatari broadcaster last year.
As with Miramax, Colony is thought to be most interested in the Weinstein Co.’s film library. It may keep other pieces, like the TV business known for “Project Runway,” or sell them off, people familiar with the matter said.
The woes have continued to pile up for the New York-based Weinstein Co. New York Atty. Gen. Eric Schneiderman’s office on Monday launched a civil rights investigation into Weinstein Co., issuing a subpoena seeking troves of documents, including any files related to harassment complaints and settlements.
Meanwhile, filmmakers are trying to distance themselves from the company that has been tarnished by Weinstein’s alleged actions. The producers of “Paddington 2” have said they’re hoping to find a new U.S. distributor for their movie to replace the Weintsein Co., though it’s unclear how they will do that. The Weinstein Co. paid $20 million for the U.S. rights to the family film, according to one insider.
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