The Weinstein Company is planning to file for bankruptcy after talks to sell the film studio broke down in the wake of sexual misconduct allegations against the co-founder Harvey Weinstein.
The company had failed to strike a deal with an investor group headed by Maria Contreras-Sweet, a former Obama administration official, and Ron Burkle, the private equity millionaire, according to US media. The studio said this left it with “little choice”.
“Over the coming days, the company will prepare its bankruptcy filing with the goal of achieving maximum value in court,” the maker of films such as The King’s Speech and Paddington said in statement reported by the New York Times.
In a separate letter reported by US media, TWC told Ms Contreras-Sweet and Mr Burkle their proposed rescue plan was “illusory and would only leave this company hobbling toward its demise to the detriment of all constituents”.
TWC added it had worked “tirelessly” to secure a deal and had met “virtually every demand” the investors had imposed. But it said the draft terms offered presented no viable option for a sale.
The New York Times reported the investor group had offered to pay roughly $275m for TWC while assuming $225m of debt.
The studio has also been in crisis since the accusations against its former chief executive came to light. It, struggling to secure its survival in the wake of cancelled projects and the resignation of most of its board.
The attempt to save the company also was hit by the decision of the New York attorney general to file charges earlier this month against the studio and Mr Weinstein.
The lawsuit filed by Eric Schneiderman, the state’s top prosecutor, follow a four-month investigation into TWC. The complaint alleges “a years-long gender-based hostile work environment, a pattern of quid pro quo sexual harassment, and routine misuse of corporate resources for unlawful ends” dating back to 2005, the year Mr Weinstein founded the company with his brother Bob, who is also named in the suit.
The complaint alleges that Mr Weinstein engaged in a long-running pattern of harassment and abuse, and that the company failed to investigate or stop it. It accuses the brothers and TWC of “repeated, persistent, and egregious violations of law”.
Since the first allegations against him emerged publicly in October, Mr Weinstein has been accused by more than 80 women of harassment or assault. He denies all allegations of non-consensual sex. He was fired from TWC in October and is under criminal investigation by police in New York, Los Angeles and London.
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