Posted: Monday, October 16, 2017 – 10:43 AM
The Weinstein Co. announced Monday is in negotiations to sell part or all of itself to the private equity firm Colony Capital.
The company, which finds itself beset by sexual harassment and assault allegations against ousted co-founder Harvey Weinstein, also said it has a preliminary agreement for Colony Capital to give it an immediate cash infusion.
“We believe that Colony’s investment and sponsorship will help stabilize the company’s current operations, as well as provide comfort to our critical distribution, production and talent partners around the world,” Weinstein Co. board member Tarak Ben Ammar said Monday in remarks reported by the Los Angeles Times. “Colony’s successful experience and track record in media and entertainment will be invaluable to the company.”
Colony Capital is the global private equity arm of real estate and investment management firm Colony NorthStar Inc. In 2010, a group of investors led by Colony Capital and construction magnate Ronald Tutor acquired film and TV firm Miramax, which was founded by Harvey Weinstein and his brother, Bob Weinstein, from Walt Disney Co. The Weinsteins left Miramax in 2005, and it was bought by BeIN Media Group, a broadcaster based in Qatar, in 2016.
Bob Weinstein, Weinstein Co.s lone remaining chairman since Harvey Weinstein, his brother, left, reportedly for sex addiction rehab, said Friday the company was not shutting down or for sale, but his statement was immediately contradicted by a high-level person within the studio who was not authorized to comment.
“It’s just not true,” that person told the Los Angeles Times, adding that the only remaining hope for the studio and its backers is to sell it off in pieces, enabling investors and lenders to extract whatever value is left.
At least one investor has already publicly distanced itself from Weinstein Co. On Friday, investment banking firm Goldman Sachs said it was exploring options for what to do with its small stake in the studio, The Times reported.
The bank helped finance the creation of the studio in 2005 by raising close to $1 billion. A Goldman Sachs spokesman has said the firm’s stake is now worth less than $1 million, though he did not say how much of the company the bank owns, The Times reported.
Over the weekend, Harvey Weinstein was banished by the Academy of Motion Picture Arts and Sciences. The board of the Producers Guild of America is scheduled to meet Monday and could follow suit.
Additionally, French President Emanuelle Macron has said he will strip Weinstein of his membership in the Legion of Honor, and the British Academy of Film and Television Arts announced last week it has suspended Weinstein’s membership.