The Weinstein Co. announced on Sunday that it will declare bankruptcy after a $500 million deal to sell the company collapsed. The studio co-founded by Harvey Weinstein has been crippled by the sexual harassment case and assault allegations that have been levelled against him. It appears now that the studio will sell its assets as it is falling apart.
The studio's board of directors said in a letter on Sunday night that the would-be buyers were unwilling to provide interim financing to keep it afloat while the deal was finalised. Without that cash, the company is on its last legs, the board indicated. “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," it continued reading.
The group of investors seeking to buy the assets -- led by Maria Contreras-Sweet, former head of the U.S. Small Business Administration -- have not yet publicly responded to the board. A source involved in the talks have confirmed that the investors have received the letter. "They are trying to figure out if there's still a way forward," the source said. The bankruptcy paperwork has not yet been filed, according to two sources, but it could be filed in the next few days.
Stay tuned for updates on the same.