Former Obama Admin Official Offers To Buy Weinstein Co. For $275 Million
One former Obama administration official is trying to engineer a feminist takeover of Weinstein Co., the embattled “mini-major” Hollywood studio that has been spiraling toward bankruptcy since one of its founders, Harvey Weinstein, was exposed for a decades long history of sexual harassment and assault.
According to Reuters, Maria Contreras-Sweet, the former head of the Small Business Administration between 2014 and 2017, has offered to acquire Weinstein Co., a spokeswoman for the U.S. film and TV studio said on Sunday.
A consortium of investors assembled by Contreras-Sweet has put together an offer of $275 million to buy the embattled studio, which has seen revenues plunge since the name Weinstein became synonymous with Hollywood’s coercive, predatory culture. Presently, both the LAPD and NYPD have suggested that they’re nearly ready to indict Weinstein for a host of sex crimes, including at least two rapes.
Weinstein Co. has had difficulty securing short-term financing, which is one reason why its owners would probably be amenable to such a generous bid. Talks to secure a $35 million lifeline from Fortress Co. last month fell apart. And though the studio did secure a cash injection from Thomas Barrick Jr.’s Colony Capital, the firm ultimately backed away from a deal to purchase most of Weinstein Co.’s major assets.
Contreras-Sweet’s bid comes after the movie studio secured a $20 million cash infusion from the sale of the children’s movie “Paddington 2” last week to Warner Brothers Pictures, a unit of Time Warner Inc. The Weinstein Co.’s co-chairman Harvey Weinstein stepped down last month following sexual assault allegations.
So far, at least 84 women have accused Weinstein of harassment, groping and assault, all of which took place over the last three decades. Worse still, a story published earlier in this month by the New Yorker delved into Weinstein’s practice of hiring private security contractors to intimidate his victims into remaining silent.
In a brilliant twist that would help ameliorate much of the stigma surrounding the studio and its legacy, Contreras-Sweet’s plan calls for installing a majority-female board at The Weinstein Co. Her offer includes an approximately $30 million fund for the alleged victims of Harvey Weinstein, the source added. The fund would be set up through a mediation process, according to the source.
The spokeswoman for the Weinstein Co. didn’t comment on the details of the offer it received. A spokesman for Contreras-Sweet declined to comment.
US President Barack Obama in 2014 selected Contreras-Sweet as the head of the SBA, which makes loans to small businesses and helps them get government contracts. She had previously founded ProAmerica Bank, a Latino-owned community bank in Los Angeles, which focuses on lending to small- and medium-sized Latino businesses. The SBA is now run by Trump appointee Linda McMahon.
Contreras-Sweet’s offer is more than generous, especially considering that Goldman Sachs, which owned a small equity stake in the studio, recently marked its holdings down to zero, reflecting the view that the studio and its assets have become toxic in the wake of the Weinstein scandal.
The proceeds from the “Paddington 2” sale will enable the Weinstein Co to continue to operate until January, the source said. Investment firm Fortress Investment Group LLC was considering lending to the film and TV studio, but those talks ended without a deal earlier this month.
More than 20 other potential bidders are analyzing The Weinstein Co’s financial data, the source said. The studio has $375 million in debt, including a $45 million loan from AI International Holdings Limited, an affiliate of billionaire Len Blavatnik’s industrial group Access Industries, the person said. Much of the debt is backed by the company’s film and TV assets.