The crippled Weinstein Co. may have a buyer — and he happens to be a close friend of President Trump.
On Monday the movie and TV studio announced a financing deal with Tom Barrack’s private equity firm Colony Capital. The deal will help the studio stay afloat in the short term.
But more significantly, Weinstein Co. said it is negotiating with Colony “for a potential sale of all or a significant portion of the company’s assets.”
“We will help return the company to its rightful iconic position in the independent film and television industry,” Barrack said in a statement.
A sale could wipe away the Weinstein Co. name and help the company recover from a widening sexual harassment scandal.
For the past eleven days the studio has been dragged down by allegations of sexual misconduct against co-founder Harvey Weinstein. Weinstein was fired by the board on October 8, three days after a New York Times detailed a decades-long pattern of alleged harassment.
Further reports by The Times and The New Yorker indicated that the company’s senior management knew about some of Weinstein’s behavior, although that is in dispute.
As a result of all this, Weinstein Co. has been stuck in a state of corporate limbo. There are widespread doubts in Hollywood about Weinstein Co.’s future as a standalone company.
Now comes Barrack and Colony Capital. The private equity firm has had a business relationship with Weinstein Co. for several years.
Barrack’s name has been in the news lately because he is a rumored candidate for White House chief of staff. He has been a close confidant of Trump for years and was the chairman of Trump’s private Presidential Inaugural Committee.
His involvement on Monday provided undeniable intrigue, given that he’s helping to rescue a company paralyzed by a sexual harassment scandal — and that Trump has faced harassment allegations as well.
Then-candidate Trump strongly denied any wrongdoing when women came forward and accused him of misconduct in the wake of the “Access Hollywood” tape last year.
Trump has only publicly commented on the Weinstein scandal once. He said on October 7 that “I’ve known Harvey Weinstein for a long time. I’m not at all surprised to see it.”
The “immediate capital infusion” and the sale talks were announced by one of the company’s three remaining board members, Tarak Ben Ammar, in a statement “on behalf of the board.”
“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,” he said. “Colony’s successful experience and track record in media and entertainment will be invaluable to the Company as we move forward.”
The Weinstein Co. produces popular TV shows like “Project Runway” and films like “Lion.” The company’s next film, “The Current War,” was supposed to come out in November, but it has now been delayed to early 2018.
Monday’s announcement contradicts what the company’s co-chairman Bob Weinstein, Harvey’s brother, said just a few days ago. On Friday he denied a Wall Street Journal report that the company was “exploring a sale or shutdown and is unlikely to continue as an independent entity.”
“Our banks, partners and shareholders are fully supportive of our company, and it is untrue that the company or board is exploring a sale or shutdown of the company,” Bob Weinstein said in response.
He claimed that “business is continuing as usual as the company moves ahead.”
But that is far from the truth.
Barely any work is getting done at the company’s offices in New York and Los Angeles, sources told CNN.
Staffers are embarrassed and shocked by the depths of the scandal. Some have even compared working there to being aboard the Titanic.
CNNMoney (New York) First published October 16, 2017: 9:52 AM ET