A $500 million deal to sell the Weinstein Co. appears to be on firmer footing after a 3.5-hour meeting Wednesday at the office of the New York attorney general.
Investor Ron Burkle, the key financier behind the deal, met with Attorney General Eric Schneiderman and attorneys from his office. Also participating was Maria Contreras-Sweet, the former head of the Small Business Administration, who has been the public face of the new ownership group. Representatives from the Weinstein Co. were also present for much of the meeting.
The sale, originally expected to be announced last week, has been on hold after Schneiderman’s office filed a discrimination suit against the Weinstein Co. on Feb. 11. Schneiderman has raised a series of objections to the sale, including his concern that Harvey Weinstein and his enablers should not be allowed to profit. The attorney general was particularly concerned about a plan to make Weinstein’s right-hand man, David Glasser, the new CEO. He has also questioned whether a proposed victims’ fund would be adequate to compensate women who have brought claims against the company.
In the meeting, Schneiderman reiterated his view that Glasser would not be an acceptable CEO. Burkle, who is close to Glasser, has been reluctant to dispense with him, even after the Weinstein Co. board fired him for cause last Friday. (On Wednesday morning, Glasser’s attorney threatened to bring an $85 million wrongful termination suit against the company.)
There was discussion of increasing the victims’ fund, though numbers remain somewhat fluid. Various figures — ranging from $10 million to $50 million — have been floated in recent weeks. Schneiderman has openly questioned whether the fund amounts to anything more than the liability limit of the Weinstein Co.’s employment practices insurance policy. He has also expressed concern that the fund would be eaten up by legal fees, with relatively little left for victims.
As the meeting wrapped up, it appeared that the deal was still viable, and that the bidders and the Weinstein Co. could reach an agreement that the attorney general would not feel compelled to oppose.