Weinstein Company buyers pull out after much more debt found

he eleventh-hour deal to save Harvey Weinstein’s TV and film company from going bankrupt has fallen through, after the buyers discovered tens of millions of dollars more in liabilities on the books than expected.

Last week, a consortium of investors led by Maria Contreras-Sweet, a former senior official in Barack Obama’s administration, and US billionaire Ron Burkle, entered the final stage of a $500m (£360m) deal to buy the Weinstein Company.

The deal, which included taking on an expected $225m in debt on the company’s books, has fallen through for a second time in as many weeks.

The investor group, which on 1 March entered a 40-day process to go over TWC’s books with a fine-tooth comb before completing the deal, is understood to have uncovered about $50m-60m more in debt and other liabilities than previously thought.

“All of us have worked in earnest on the transaction to purchase the assets of the Weinstein Company,” said Contreras-Sweet in a statement. “However, after signing and entering into the confirmatory diligence phase, we have received disappointing information about the viability of completing this transaction. As a result, we have decided to terminate this transaction.”

Last month, TWC’s board said the company was set to go into bankruptcy after it said the deal offered by Contreras-Sweet was “illusory”. Last week, a new deal was reached, which included doubling a fund for victims of Harvey Weinstein to $80m, which has fallen through.

Source: theguardian