Lantern Capital Partners has won court approval to buy Weinstein Co. out of bankruptcy, defeating a surprise competing offer from Inclusion Media.
A Delaware bankruptcy court judge on May 8 approved the sale of Harvey Weinstein’s movie and TV production company to private equity firm Lantern for $310 million. Inclusion Media, an investment company led by Broadway producer Howard Kagan, made its rival bid May 1, one day after the deadline to submit proposals, according to court documents.
Weinstein Co. filed for Chapter 11 bankruptcy protection on March 19, less than six months after The New York Times published bombshell allegations that Weinstein had sexually harassed actresses. The allegations against the movie mogul continued to surface after the story, sending Weinstein Co.'s finances spiraling downward as the #MeToo movement took hold.
Before its bankruptcy, other potential buyers had looked at buying the film production company. Weinstein Co. said in October, soon after the sexual harassment allegations came to light, that it struck an agreement to be bought by Colony Capital. After the deal fell apart, an investor group led by Maria Contreras-Sweet, the former head of the U.S. Small Business Administration, agreed to buy the beleaguered company. But that deal also crumbled, according to a Bloomberg report March 6.
Lantern made its offer the day after Weinstein Co. filed for Chapter 11 bankruptcy protection. A committee of creditors opposed the sale, saying it was “mystifying” that a piecemeal sale of its assets had not been considered, according to a bankruptcy court filing on May 7. The deadline to submit rival offers was April 30 and the sale hearing was May 8.
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The creditors also expressed concern about Inclusion Media's offer, saying it was unclear how the company planned to pay for the company, according to the May 7 filing. “Indeed, there was no indication on May 1— and there remains no indication today—that Inclusion Media has the financing or equity commitment to make a qualified bid now or in the future,” the creditors said in the court document.
Eminem and Jay-Z were among the numerous artists who objected to the sale of Weinstein Co. to any party, citing pending payments for unfinished projects, according to bankruptcy court documents filed May 3.
Andy Mitchell, Lantern's CEO, didn't return a phone call seeking comment on its purchase of Weinstein Co. A spokesperson for Weinstein Co. didn't reply to an email seeking comment.