×

Colony Capital Has Three-Week Window to Avert Weinstein Co. Bankruptcy (EXCLUSIVE)

Colony Capital has been granted a three-week window to negotiate a deal for some or all of the Weinstein Company’s assets, as the company seeks to avoid a bankruptcy filing.

Sources tell Variety that the Weinstein Co.’s financial situation, and particularly its debt load, are more dire than was previously known. Nevertheless, Colony Capital, under the leadership of Tom Barrack, is still working toward some sort of purchase. Insiders say that Colony has reached out to other potential partners to help close the deal.

There has also been a shift in the human resources department, which has come under harsh criticism for failing to stand up to Weinstein’s abuses. Frank Gil, the head of the department, has been let go. He’s been replaced by David Anderson, an industry veteran who has worked with companies who are trying to dig out from troubling financial situations.

The Weinstein Co. was not in great financial shape before it was hobbled by the worst sex harassment scandal in Hollywood history. The company narrowly avoided going bankrupt in 2010, when it traded away 200 films in its library to Goldman Sachs and Assured Guaranty in a deal to wipe away $450 million in debt.

The company’s remaining assets are now in perilous condition. Weinstein is gone, having been fired after allegations surfaced that he had harassed or assaulted dozens of women over three decades. The top executives are either looking for the exits or facing difficult accusations of their own (co-founder Bob Weinstein has also been accused of harassing an employee, while chief operating officer David Glasser has a checkered legal history). The Weinstein brand is damaged beyond repair, to the point where the company is now exploring a name change. Several of the company’s projects in development have been canceled, while those that remain are not viewed as surefire commercial successes. Meanwhile, the company faces the potential of massive liabilities associated with future sex harassment claims.

The situation is beginning to resemble the collapse of Relativity Media, which declared bankruptcy in 2015 and went through a series of aborted rescue plans and auctions. Today, that company is essentially defunct. On Thursday, the Financial Times reported that Harvey Weinstein is working with billionaire Len Blavatnik and investor Ron Burkle on a purchase plan. Insiders say that they will have to wait at least until Colony’s three-week window expires to buy the company unless they team with Barrack. Burkle was an investor in Relativity.

Internally, work has ground to a halt, with staffers kept in limbo while they wait to see if they will have a new owner. Many are also processing their own complicated feelings about Harvey Weinstein’s alleged abuse of women, while trying to land new jobs. Those staffers still under contract believe that they can find new work and break their employment agreements because the situation is so chaotic.

The Weinstein Co. declined to comment.

More Biz

  • Young ThugBillboard Hot 100, Day 2,

    Travis Scott Remix Drives Young Thug’s ‘Hot’ to No. 1 on Rolling Stone Top 100

    Driven by a remix featuring Travis Scott, Young Thug’s single “Hot” has roared to the top of the Rolling Stone Top 100 this week. The song racked up more than 20 million audio streams and 3,700 downloads. Also getting a big boost is buzzing artist Arizona Zervas, whose “Roxanne” soared to No. 6 after debuting at [...]

  • Kevin LilesUJA-Federation of New York's Music

    300’s Kevin Liles Joins NY:LON Summit Keynote Roster

    The Music Business Association (Music Biz) and Music Ally today announce that 300 Entertainment cofounder and CEO Kevin Liles will deliver a keynote interview at the fourth annual NY:LON Connect music business summit. The conference takes place January 16 – 17, 2020 at the Dream Downtown Hotel in New York. According to the announcement, Liles [...]

  • Warner Bros. HQ LA

    Small Brush Fire Breaks Out Above Warner Bros. Lot in Burbank

    UPDATED: A small brush fire broke out in the Hollywood Hills above the Warner Bros. studio lot in Burbank, Calif., causing the Warner Bros. lot to evacuate as a precaution, before its forward progress was stopped at around 5 p.m. Saturday. According to the LAFD, fire crews are working on putting out the “still active [...]

  • Woody Allen

    Woody Allen Settles $68 Million Suit Against Amazon

    Woody Allen has settled his breach of contract lawsuit against Amazon, which canceled a four-picture deal with the filmmaker amid the #MeToo movement. Allen’s attorneys and lawyers for Amazon filed a joint notice dismissing the case on Friday night. Terms of the settlement were not disclosed. Allen filed suit in February, alleging that Amazon had [...]

  • Scott Stuber, Ron Howard are seen

    Netflix's Scott Stuber: Film Biz Needs to 'Be Calm and Talk Through' Exhibition Disputes

    Netflix film chief Scott Stuber urged film producers and exhibitors to come together to reach a consensus on exhibition window disputes as Netflix and other streaming giants move forcefully into feature production. Stuber, Netflix’s VP of film, spoke Saturday morning at the Producers Guild of America’s Produced By NY conference in a wide-ranging Q&A with [...]

  • Donald Trump Hollywood Racism

    President Trump Bashes Report of Talks With Mark Burnett for New 'Apprentice' Series

    President Donald Trump took to Twitter on Saturday morning to blast as “fake news” a report earlier this week that he is planning to develop a TV series with “The Apprentice” creator Mark Burnett following his time in the White House. On Thursday, the Daily Beast reported that Trump has been talking to Burnett, a [...]

  • BMG Music

    BMG Announces Move to Bigger Digs in L.A., Following Nashville and NYC Relocations

    Less than two months after announcing a planned move to a bigger and better facility in Nashville, BMG has declared plans to do the same in Los Angeles, with a deal in place to develop a two-story, 30,000-square-foot facility in the Miracle Mile district. It won’t be a long move: the location for the “proposed” [...]

More From Our Brands

Access exclusive content