It’s been almost five months exactly since the New York Times launched the #MeToo movement with its initial expose about disgraced Hollywood studio head Harvey Weinstein’s decades-long history of sexual predation – which was enabled, the paper explained, by the silence of his peers and a flurry of NDA-clad settlements. And today, after a $ 500 million deal involving a former Obama administration official reportedly fell apart, Variety is reporting that the Weinstein Co. will declare bankruptcy.
To wit, TWC’s board released a letter Sunday evening to investors Ron Burkle and Maria Contreras-Sweet, the leaders of the bid group, breaking off negotiations. According to the letter, the company is in dire need of operating cash, but the bidders have so far refused to provide interim financing.
“Based on the events of the past week, however, we must conclude that your plan to buy this company was illusory and would only leave this Company hobbling toward its demise to the detriment of all constituents,” the letter stated. “Despite your previous statements, it is simply impossible to avoid the conclusion that you have no intention to sign an agreement – much less to close one – and no desire to save valuable assets and jobs.”
The sale was close to being announced exactly two weeks ago, when New York Attorney General Eric Schneiderman stepped in and filed a suit accusing the company of enabling Harvey Weinstein’s sexual abuses. The lawsuit scrambled the deal, creating the possibility of an outside monitor or other intrusive provisions. Schneiderman also objected to the investors’ plan to hire David Glasser, the COO under Weinstein, as CEO.
Schneiderman met on Wednesday with Contreras-Sweet, Burkle, and representatives of the Weinstein Co. board. After the meeting, it appeared that a deal could be reached that would meet with Schneiderman’s approval.
However, it appears that the added stress on the transaction exposed conflicts between the two sides. According to the Weinstein Co. letter, the two sides continued to have conflicts over Glasser’s role, a week after the board fired him.
Read the full letter below: