The Weinstein Company filed for bankruptcy in Delaware on Monday, in hopes to enter an organized sale process with Lantern Capital Partners’ as a stalking horse bidder for virtually all of the company’s assets, the company announced.
The Dallas-based private equity firm has agreed to keep the studio’s employees on as a “going concern,” should a bankruptcy court approve the sale for $310 million, according to court filings.
In its filing under Section 363 of the U.S. Bankruptcy Code, the company listed both assets and liabilities of between $500 million and $1 billion. Top creditors include Union Bank and Bank of America who are owed $156 million.
Unsecured creditors include China’s Wanda Pictures ($14.4 million), marketing company Palisades Media ($13.7 million) and David Boies’ law firm Boies, Schiller and Flexner ($5.7 million).
“While we had hoped to reach a sale out of court, the board is pleased to have a plan for maximizing the value of its assets, preserving as many jobs as possible and pursuing justice for any victims,” Bob Weinstein said in a statement provided to TheWrap.
In addition to bankruptcy sale, the board of directors made a jaw-dropping announcement that it would release Harvey Weinstein’s accusers from their nondisclosure agreements — effectively ending a long and widely-reported pattern of silence.
“The Board also expressed its great appreciation to New York Attorney General Eric Schneiderman, and his colleagues, for helping the Company achieve these objectives,” he added of the state politician, who sued to block an original $500 million sale over lack of victims compensation among other concerns.
In its bankruptcy filing, the company named Robert del Genioof FTI Consulting as its chief restructuring officer, overseeing the company’s finances and operations during the bankruptcy process. The board also retained Moelis as its banker and two law firms, Cravath, Swaine & Moore and Richards, Layton & Finger.
The voluntary filing ends a long attempt to rescue the indie film and TV studio that has unraveled since the ouster of co-founder Harvey last October after dozens of women accused him of sexual assault and harassment.
Earlier this month, a group of investors led by Maria Contreras-Sweet and Ron Burkle withdrew from an agreement to purchase the company, citing what they called the sudden revelation of $50 million in additional liabilities.
Only days prior to the news, Contreras-Sweet trumpeted that she found a way to purchase almost all TWC’s assets and avoid a bankruptcy process — negotiating a deal that met with the approval of both TWC’s three remaining board members, including co-founder Bob Weinstein and Schneiderman.
Schneiderman had thrown a monkey wrench into the sale plans last month by filing a lawsuit over civil rights violations and had argued the case for a more generous compensation fund for women found to have been victims of Weinstein’s abusive behavior.
Only days before the hopeful investors bailed, they triumphantly announced a plan to save the company’s roughly 150 jobs, to pay a long line of TWC creditors and vendors and to establish a victims fund.
The New York-based company, founded in 2005 by, has cut an outsize swath in the indie film world, producing back-to-back Oscar Best Picture winners (2010’s “The King’s Speech” and 2011’s “The Artist”) as well as mainstream hits like Quentin Tarantino’s “Django Unchained,” “Scary Movie 4” and the family film “Paddington.”
TWC’s profitable TV division boasts one megahit franchise: Lifetime’s long-running fashion reality series “Project Runway” and its many spinoffs. It has also produced episodic series such as MTV’s “Scream” and Netflix’s “Marco Polo,” which were both canceled after two seasons.
In conclusion, the TWC board said it “regrets that it cannot undo the damage Harvey Weinstein caused, but hopes that today’s events will mark a new beginning. Even as the Company heads into bankruptcy, the Company remains committed to doing whatever it can to maximize value for its creditors and, in cooperation with Attorney General, continue its pursuit of justice for any victims.”