The Weinstein Company, on the middle of the hurricane
One of the most powerful and respectful film producers companies in the United States of America has felt down, the prestigious Weinstein Company in which everyone wanted to work in, and that now is begging for money and trying to find creditors to save it from an upcoming ruin. As a collateral damage American movie and TV studios would need a loan of around 25 million to save the production. The Weinstein Company has lost strength in cinema business after the famous case of sexual abuse and harassment that involved producer and studio co-founder, Harvey Weinstein. He was fired of the company last October after allegations from dozens of women who said his abuses had persisted for decades.
Since the allegations went public by The New York Times and TheNew Yorker, the big business egocentrically built by The Weinstein Company has collapsed and now they are struggling financially. The company tried to take out loans from private, but those plans didn’t succeed. Colony predicted the Weinstein Company would end up bankrupted. One of the movements done by the company was to sale distribution rights to Paddington 2, a children’s movie that came out last month.Still, Weinstein Company has not decided yet whether to accept the creditors or not. One of the possible debtor-in-possessions financers can be the Fortress Investment Group LLC.
The powerful company has lost all the credit. No one wants to lean on Harvey´s Company because it is a way of being involved with the enterprise and indirectly to help to the sexual depredator’s cause. It is quite known that nowadays American society has experienced a scandal outburst, and that of Weinstein has positive consequences too because it provoked to reopen several cases of sexual harassment and the creation of a women’s movement that gives voice to females.
One of the exit gates Weinstein Company may have is to use the external financing for its insolvency. Nevertheless, according to some sources, a judge must approve the loan. The Weinstein Company was closing the sign of an agreement over 500 million dollars, led by former Obama administration official Maria Contreras but last February 11 New York’s General Attorney, Eric Schneiderman, threw to the basket any possible deal.
Eric Schneiderman indicted the company and its founders, the Weinstein brothers, under the crimes of “vicious and exploitative mistreatment of company employees.”
The possible loan of Contreras and billionaire Ron Burkle, also entered into talks about a potential purchase of the company. The original deal planned to pay $275 million and take on $225 million.
As a way to prevent futures sexual and power abuses, Contreras thought a plan to position women on board and to found a bill for Weinstein’s victims that would include a $10 million line of credit and at least $40 million more from selling off Weinstein Co. film and television projects. Of course, Weinstein brothers will be out of the profits. However, the Weinstein board didn´t accept the agreement. They wrote a letter saying the Weinstein Company would be better off declaring economic failure. It is sure that to accept the agreement would be to accept the allegations against Harvey, since Contreras’plans underline an idea that members of the board disliked. Furthermore, Weinstein still declares himself as not guilty of the several charges against him; all lead to the fact that Maria Contreras and Burkle met with Schneiderman trying to make a deal and save The Weinstein Company.
The good news is that some lenders are willing to provide the financing despite the claim of society and other bank lenders and creditors. Objectively, the best for US cinema regardless the scandal is to save the Company. Why? There still are several projects left inside cabinets waiting for a budget or the ideal moment to be produced. God only knows how many box-ticket hits or outstanding movies remain as script projects waiting for funds. Another reason is that Weinstein´s movie library is recognized as the most valuable asset of studios, so it could be a loss to Cinema history and heritance.
In contrast, no one thinks that allegations against The Weinstein Company would have several economical, professional financial repercussions for abusers. Weinstein is a constant target of the every day stronger #MeToo movement. Other cases are Kevin Spacey’s, who will never get close to a set in the rest of his life, and executive Roy Price from Amazon Studios resigned due to the pressure of sexual misconduct allegations.