A group of investors led by Maria Contreras-Sweet, the former head of the U.S. Small Business Administration, is in a strong position to buy the Weinstein Company, according to insiders.
The indie studio is on life support in the wake of a massive sexual harassment and assault scandal involving its founder, Harvey Weinstein. He has been accused of sexual misconduct by dozens of women, with allegations going back decades. Weinstein denies the claims and says all sexual contact was consensual.
Contreras-Sweet lacks entertainment industry experience, but she intends to keep much of the Weinstein Company’s staff employed to run the studio. Bob Weinstein, Harvey Weinstein’s brother, would leave the studio if Contreras-Sweet is successful. The bid would likely include a possible $30 million cash infusion and the assumption of hundreds of millions of dollars in debt.
Other bidders include Killer Content, the producer of “Carol” and “Still Alice”; Lionsgate, the studio behind “The Hunger Games”; Shamrock Capital, and Vine Capital. Some want to buy the company in its entirety, others just want certain assets.
There is speculation that Ron Burkle’s Yucaipa Enterprises is a minority partner in Contreras-Sweet’s bid, but a spokesperson for the billionaire investor downplayed those reports.
“I can confirm Yucaipa does not have a deal in place with Maria Contreras-Sweet,” the spokesperson said. “We know she is raising funds, but we have not been a part of her fundraising. One thing is for certain, we share her belief that a women-led board is the only possible way the company survives at this point.”
A spokesperson for Contreras-Sweet’s office said reports of an imminent deal were speculative.
“No deal in place,” the spokesman emailed. “Nothing to report.”
Contreras-Sweet is hoping to install an all-female board of directors and to try to turn the Weinstein Company’s tarnished brand and legacy into something positive and feminist. She also gets a library of such award-winning films as “The Artist” and “The King’s Speech,” as well as popular shows such as “Project Runway.”
However, the company has struggled financially for years, releasing flops like “Tulip Fever” and “Burnt,” while sinking deeper and deeper into debt. Its library is heavily leveraged and many projects that were in development have gone up in smoke in the wake of the harassment scandal.
There were reports that Yucaipa considered buying the Weinstein Company in 2015, but an insider denied that discussions ever took place.
In addition to working in Barack Obama’s administration, Contreras-Sweet was founding chairwoman of ProAmérica Bank and created Fortius Holdings, a private venture capital firm that invests in small businesses, particularly ones owned by Latinos and women.
Though Contreras-Sweet’s group is seen as the likely winner in the Weinstein bidding, one insider said that many hurdles remain and it could be days before a deal closes.
Deadline Hollywood first reported Contreras-Sweet as the frontrunner for The Weinstein Company.