Welcome to the show folks...
The fortunes of The Weinstein Company are not looking very well. First, the $300 million success of Inglorious Bastards* hasn't rea
lly trickled down to TWC, since Universal sucked up most of that, and what ever leavings TWC did get were not only sucked up by that movie's P&A costs, but by the extremely underwhelming box-office performance of their all-star musical Nine.
And to add insult to injury, there are reports that Ambac, the company that's insuring TWC's $500 million debt, is possibly skimming the event horizon of bankruptcy itself.
That's not good, not good at all.
In fact, Goldman Sachs, who holds the bulk of that $500 million debt could come down on TWC and chop it into a million pieces, like Harvey himself has done to so many independent films over the years.
The problem with that plan is that TWC's assets, like its film library and the dust that's coating it is not likely worth the $500 million the company needs. Apparently buying and producing a truckload of movies, and then not releasing them is not a good business strategy.
Now the Weinsteins, ever masters of spin, are spinning like nuclear powered tops to try to put some lipstick on this pig of a situation. They're saying that they sold the foreign rights of the $64 million Nine for $50 million, and that the film might still make money, completely ignoring the millions spent on prints, advertising, and their traditional hyper-expensive Oscar whoring, and let's not forget that the film is carrying the Curse of Nicole Kidman.
They're trying to use this same formula in an attempt to restructure the company's finances.
Which I predict will transform The Weinstein Company into a major studio.
The problem is that studio is United Artists after Heaven's Gate.
Okay, I exaggerate.
But not by much.
It's actually a lot like MGM-UA.
Allow me to explain: TWC needs money to make the movies they need to make the money they need to get out of debt and become viable. The problem is that to get that money they need to make those movies, they need to rack up more debt and sell the foreign rights. Selling the foreign rights means that they're going to make a lot less money off those films, thus putting them in what strikes me as a hand-to-mouth on a grand scale situation.
And that's if each and every film they produce makes a profit domestically.
Unlike MGM, I don't see many outside investors rushing to play the white knight for TWC, not with the weak value of the library and the Weinstein brothers' reputation for just being hard to do business with. No one in their circle has the money or the time to waste propping them up so they can repeat the cycle that pretty much sank Miramax as a major player and is currently sinking TWC in a sea of red ink.
While I won't totally count the Weinsteins out, they are harder to get rid of than herpes, I don't really see this situation ending well for the company.
What do you folks think?
The fortunes of The Weinstein Company are not looking very well. First, the $300 million success of Inglorious Bastards* hasn't rea
lly trickled down to TWC, since Universal sucked up most of that, and what ever leavings TWC did get were not only sucked up by that movie's P&A costs, but by the extremely underwhelming box-office performance of their all-star musical Nine.And to add insult to injury, there are reports that Ambac, the company that's insuring TWC's $500 million debt, is possibly skimming the event horizon of bankruptcy itself.
That's not good, not good at all.
In fact, Goldman Sachs, who holds the bulk of that $500 million debt could come down on TWC and chop it into a million pieces, like Harvey himself has done to so many independent films over the years.
The problem with that plan is that TWC's assets, like its film library and the dust that's coating it is not likely worth the $500 million the company needs. Apparently buying and producing a truckload of movies, and then not releasing them is not a good business strategy.
Now the Weinsteins, ever masters of spin, are spinning like nuclear powered tops to try to put some lipstick on this pig of a situation. They're saying that they sold the foreign rights of the $64 million Nine for $50 million, and that the film might still make money, completely ignoring the millions spent on prints, advertising, and their traditional hyper-expensive Oscar whoring, and let's not forget that the film is carrying the Curse of Nicole Kidman.
They're trying to use this same formula in an attempt to restructure the company's finances.
Which I predict will transform The Weinstein Company into a major studio.
The problem is that studio is United Artists after Heaven's Gate.
Okay, I exaggerate.
But not by much.
It's actually a lot like MGM-UA.
Allow me to explain: TWC needs money to make the movies they need to make the money they need to get out of debt and become viable. The problem is that to get that money they need to make those movies, they need to rack up more debt and sell the foreign rights. Selling the foreign rights means that they're going to make a lot less money off those films, thus putting them in what strikes me as a hand-to-mouth on a grand scale situation.
And that's if each and every film they produce makes a profit domestically.
Unlike MGM, I don't see many outside investors rushing to play the white knight for TWC, not with the weak value of the library and the Weinstein brothers' reputation for just being hard to do business with. No one in their circle has the money or the time to waste propping them up so they can repeat the cycle that pretty much sank Miramax as a major player and is currently sinking TWC in a sea of red ink.
While I won't totally count the Weinsteins out, they are harder to get rid of than herpes, I don't really see this situation ending well for the company.
What do you folks think?
*I refuse to misspell and pander to Tarantino's pseudo-illiterate pretensions. Quentin, you are not too important to use a fucking spell check.
To make things worse the musical "Nine" starring box office poison Nicole Kidman, is going to be pulled from theatres due to poor ticket sales as it got trounced by Avatar and Sherlock Holmes.
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