Talks of a buyout came after one of its founders was fired due to an ongoing controversy
Hollywood film producer and distributor The Weinstein Company will be selling the bulk of its assets to private equity firm Colony Capital.
Reuters reported that the private equity firm will inject an immediate capital infusion into the target company and is currently in discussion to buy all or a significant portion of its assets.
To recall, the distributor of the films The King's Speech and the Silver Linings Playbook was in hot waters after a number of women went public and accused its co-founder Harvey Weinstein of sexually harassing and assaulting them over the past three decades. Eventually, Weinstein was fired by the company.
To make matters worse, the company's board has shrunk to only three people following the resignation and departure of five others.
Colony Capital will be in familiar territory if the sale pushes through. In 2010, it bought Miramax studio, the original studio founded by the Weinstein brothers in 1979. And similar to Miramax, the Weinstein Co's value would likely depend on its plethora of movie hits.
When faced with bankruptcy in 2010, The Weinstein Co gave control of hundreds of films to Goldman Sachs Group and insurance company Assured Guaranty.
Reuters said there are a couple of deal structures under consideration which involve Colony's outright acquisition of all The Weinstein Co or its major assets. The other route is for the film producer to file for bankruptcy with Colony acting as a stalking horse bidder to obtain it entirely or its major assets. The latter option would shield the private equity firm from having to bear The Weinstein Co's legal liabilities.
In a statement, The Weinstein Co said Colony's cash infusion will stabilise the company's current operations, providing comfort to its critical distribution, production, and talent partners.
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Reuters reported that the private equity firm will inject an immediate capital infusion into the target company and is currently in discussion to buy all or a significant portion of its assets.
To recall, the distributor of the films The King's Speech and the Silver Linings Playbook was in hot waters after a number of women went public and accused its co-founder Harvey Weinstein of sexually harassing and assaulting them over the past three decades. Eventually, Weinstein was fired by the company.
To make matters worse, the company's board has shrunk to only three people following the resignation and departure of five others.
Colony Capital will be in familiar territory if the sale pushes through. In 2010, it bought Miramax studio, the original studio founded by the Weinstein brothers in 1979. And similar to Miramax, the Weinstein Co's value would likely depend on its plethora of movie hits.
When faced with bankruptcy in 2010, The Weinstein Co gave control of hundreds of films to Goldman Sachs Group and insurance company Assured Guaranty.
Reuters said there are a couple of deal structures under consideration which involve Colony's outright acquisition of all The Weinstein Co or its major assets. The other route is for the film producer to file for bankruptcy with Colony acting as a stalking horse bidder to obtain it entirely or its major assets. The latter option would shield the private equity firm from having to bear The Weinstein Co's legal liabilities.
In a statement, The Weinstein Co said Colony's cash infusion will stabilise the company's current operations, providing comfort to its critical distribution, production, and talent partners.
For more of Wealth Professional's latest industry news, click here.
Related stories:
While private equity slows, venture capital soars
New managing partner named for private equity firm
