$950 Million Reasons Behind Weinstein's Big TV Reboot
No Sundance buys? No problem, as Harvey and company near a deal to sell the television division to British player ITV for a deal with nearly $1 billion potential as television content at volume becomes his next goal.
This story first appeared in the April 24 issue of The Hollywood Reporter magazine.
The buzz around The Weinstein Co. wasn't great. The most prolific film festival buyer of the past two decades had gone three major fests — Toronto, Sundance and Berlin — without a high-profile acquisition. That, coupled with a slew of executive exits, a slim 2015 film slate and co-chairman Harvey Weinstein's own PR problems when police questioned him March 28 after a woman claimed he groped her in his office, had many wondering: What's up in Harveyland?
Now it's clear. THR reported April 6 that Weinstein Co. is closing in on a deal to sell its television division to British broadcaster ITV for as much as $950 million. Weinstein isn't talking and an ITV rep says, "We do not comment on speculation." But sources confirm the deal papers are all but signed and an announcement could come before the end of April.
The influx of capital likely means a renewed focus on television for the new iteration of The Weinstein Co., which soon could look dramatically different from the film-focused company founded in 2005 by brothers Harvey and Bob. They will be flush with cash — including an upfront payment of $300 million to $400 million and an escalating package that would more than double the initial purchase price, according to sources. Weinstein will manage the division and is hiring a slew of execs to build it out.
Just as much of Hollywood has pursued the higher-yield TV business in recent years, Weinstein, 63, known for his Oscar-winning films such as this year's The Imitation Game, has made TV a priority. In addition to the Project Runway franchise on Lifetime, the privately held company now has on the air Myrtle Manor on TLC and Mob Wives on VH1. In the scripted space, its pricey Marco Polo series recently was renewed by Netflix for a second season. Several projects also are in production: a Scream series at MTV, a War and Peace miniseries with the BBC and Peaky Blinders, which aired on BBC but which Weinstein brought to Netflix. The Reaper recently was ordered straight to series as a mini at NBC.
"I suspect that with TV production booming as every traditional network and new online outlets look for premium content, TWC wants capital and a partner to be a bigger player," says Northlake Capital Management's Steven Birenberg, adding that now is a good time "given positive fundamentals of TV production."
Long before ITV swooped in, TWC had been at something of a crossroads with its film business. The company was buying fewer titles on the festival circuit, and rival Fox Searchlight seemed to be beating Harvey at two of his best games — the Oscars, where 12 Years a Slave and Birdman trumped TWC's Philomena and The Imitation Game in 2014 and 2015, respectively — and outspending the competition (Searchlight topped TWC for both Me and Earl and the Dying Girl and Brooklyn at Sundance).
"It speaks to how hot and competitive the acquisitions market has become more than anything," says Cinetic Media's John Sloss.
Weinstein Co. still has its share of hits, of course — The Imitation Game ($91 million domestic) and Paddington ($75 million), while Woman in Gold opened April 1 to a robust $2.1 million in just 250 theaters. Quentin Tarantino's The Hateful Eight is shooting and likely will be ready for fall (his Django Unchained brought in $163 million domestic for TWC).
But by most indications, Weinstein needed more capital to compete. Goldman Sachs, which saved TWC from bankruptcy in 2010 when it took an ownership interest in the company's 200 titles, sold its stake to AMC Networks in February. Investors Ron Burkle and Len Blavatnik also are known to have put money into TWC. Investment bank Allen & Co. began quietly shopping 25 percent of Weinstein TV last summer (with counsel from CAA), and it recently upped the offering to the whole division. ITV, which has been on a buying binge of TV production companies, pounced at the chance to work with Weinstein.
"Harvey has built his business making classy movies, but he has done nothing even close in the TV world," says an insider familiar with the ITV talks. Now, flush with cash (and a deep-pocketed owner), he might just get his chance.