Lantern Capital Wins The Weinstein Company In Bankruptcy Sale

Variety reports that Lantern Capital had the winning bid in The Weinstein Company’s bankruptcy sale. A bid of $315 million from Broadway producer Howard Kagan was turned down because it lacked a financing commitment and other aspects.

Weinstein board member Ivona Smith said: “Lantern’s bid clearly achieves the highest and best value for the estate and its creditors. We look forward to working with Lantern to close the transaction and consummate the going concern sale.”

The deal is still pending a signature from Delaware bankruptcy judge Mary Walrath. Lantern offered $310 million plus “the assumption of project-based liabilities totaling $115 million.” A committee of unsecured creditors has filed an objection, claiming it’s not clear the Weinsteins are getting their maximum return. The New York attorney general’s office is also expected to comment. Five plaintiffs in a class action case supported Kagan’s bid, which would have included $30 million for victims of Harvey Weinstein’s alleged sexual misconduct. That bid was submitted under Inclusion Media. The company claimed Kagan’s bid was a “conditional indication of interest” but didn’t include a purchase agreement, a deposit, a financing commitment, or other key requirements. The document was submitted after the deadline on Monday afternoon.

An attorney for the plaintiffs, Chris Armenta said: “The plaintiffs have every reason to believe that Inclusion Media will be the highest and best bidder and will be the ultimate purchaser of the Weinstein Co. assets.”

The plaintiffs claim that the Lantern bid “contains no fund for assault survivors, no equitable considerations for company employees, and no assurance protections to ensure that women are not required to submit to the ‘casting couch’ in exchange for a career in Hollywood.” A hearing happens on May 8 at 11:30 AM ET in Delaware bankruptcy court. Objections are due by 4 PM on May 7. An auction set for Friday was cancelled.

Lantern co-founders Andy Mitchell and Milos Brajovic said: “We are honored by the board’s recognition and acceptance of Lantern’s planned acquisition. Lantern looks forward to continuing our work with the constituents involved in this court supervised transaction. Furthermore, we appreciate the significant support from employees, business partners, creative talent and numerous industry leaders as we set out to launch this new company. Lantern Entertainment remains committed to providing premier content with a diverse workforce in a safe environment founded on a culture of respect and creativity.”

The Weinstein Company added: “The Weinstein Company is pleased to announce that Lantern Capital is the winning bidder in the sale for substantially all of the assets of the Company. No other bid offered as much value to the estate as the Lantern bid, which was also the Debtors’ stalking horse bid and was negotiated with input from the Office of the New York Attorney General. “Lantern’s bid clearly achieves the highest and best value for the estate and its creditors,” said Ms. Ivona Smith, a member of The Weinstein Company Board of Representatives. “We look forward to working with Lantern to close the transaction and consummate the going concern sale.”

Earlier today, news outlets reported that the Company received a letter of interest from Inclusion Media, a potential bidder backed by Howard Kagan. That letter, submitted after the bid deadline, was a conditional indication of interest that contemplated substantially less value to the estate, and did not include a purchase agreement, a financing commitment, a deposit, or a number of other requirements for a qualified bid. While the Inclusion letter did claim to offer certain attractive aspects for victims, the Debtors concluded after discussions with Mr. Kagan that the Inclusion letter was not a bona fide offer. Thus, in furtherance of its fiduciary duty, the Board selected the bid that offered, with certainty, the most overall value to the estate.