Just when things couldn’t look any worse for The Weinstein Company, the New Yorker dropped a story Tuesday that detailed rape accusations against just-ousted co-CEO Harvey Weinstein — to go along with days of reports detailing sexual harassment and settlements.
Weinstein’s scandal threatens to pull down the company he co-founded. Unless.
“If they make Harvey the bad guy and they kill him like Darth Vader, like what they’re doing right now, all these guys will be fine,” Ross Gerber, the president and CEO of wealth management firm Gerber Kawasaki told TheWrap.
The New Yorker article, written by Ronan Farrow, implicated longtime executives at TWC and Weinstein’s previous company, Miramax, for failing to stop “a pattern of professional meetings that were little more than thin pretexts for sexual advances on young actresses and models.” Farrow wrote that the practice “was widely known” within the companies, and happened at places of business.
“Sixteen former and current executives and assistants at Weinstein’s companies told me that they witnessed or had knowledge of unwanted sexual advances and touching at events associated with Weinstein’s films and in the workplace,” Farrow wrote.
Gerber, who criticized “a culture in media and entertainment” that is permissive of sex and drugs at work, said Weinstein execs will land on their feet — if they can tie all the company’s baggage to Weinstein himself.
Gerber, who told TheWrap previously that there’s no real company without Harvey, also expects TWC to look to sell off its assets, like its long for-sale TV business, even faster now.
“The Weinstein Company’s done,” Gerber said. “It accelerates liquidation now.”
Gerber and Lloyd Greif, the president and CEO of investment bank Greif & Co., told TheWrap earlier this week that they expect the company to dump its assets, such as its profitable television business, which produces Lifetime hit show “Project Runway.”
Greif said TWC has likely engaged an investment banker to evaluate sale possibilities — which Gerber said is even more timely now, given the New Yorker story and more big names coming forward with allegations of sexual misconduct, including Gwyneth Paltrow and Angelina Jolie.
TWC might want to get the best price it can now, or risk opportunistic investors waiting for additional shoes to drop. Harvey and his brother Bob own about 42 percent of the company.
TWC has had its TV business on the block for years, nearly selling it for $950 million to British broadcaster ITV in 2015. Gerber said it would be in the best interest of the company to get something for it now.
“It has to be done ASAP,” Gerber said. “It involves the shareholders, particularly Harvey and Bob, being willing to sell at a price that probably, in their mind, sucks.”
He estimated the company could fetch about $1.5 billion, which would be more than enough to pay off its debts and make investors whole.
“If they’re smart, what they do is say ‘I’m out and I get 42 percent of whatever’s left,’” Gerber said of the Weinstein brothers. “And they’re rich.”