One-time head of US governments small business unit reported to want to take over fallen movie mogul's business
Former Obama chief said to make offer for Weinstein's firm
Maria Contreras-Sweet, the former head of the US Small Business Administration (SBA), has submitted an offer to acquire The Weinstein Co, a spokeswoman for the US film and TV studio said on Sunday.
Ms Contreras-Sweet has put together a consortium of investors who have offered US$275 million for The Weinstein Co, according to a source familiar with the matter who asked not to be identified. The Wall Street Journal first reported on the offer earlier on Sunday without stating its value.
The bid comes after the movie studio secured a $20m cash infusion from the sale of the children’s movie Paddington 2 last week to Warner Brothers Pictures, a unit of Time Warner. The Weinstein Co’s co-chairman Harvey Weinstein stepped down last month following sexual assault allegations.
The movie studio, known for hit movies including The King’s Speech and Silver Linings Playbook has been trying to find a buyer or rescue financing after more than 50 women claimed that Harvey Weinstein sexually harassed or assaulted them over the past three decades.
Harvey Weinstein has denied having non-consensual sex with anyone. Reuters has been unable to independently confirm any of the allegations.
Ms Contreras-Sweet’s plans call for a majority-female board at The Weinstein Co should her offer prevail, the source said. The offer includes an approximately $30m 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 did not comment on the details of the offer it received. A spokesman for Ms Contreras-Sweet declined to comment.
The US president Barack Obama in 2014 selected Ms 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.
Goldman Sachs has marked its small equity stake in The Weinstein Co down to zero, Reuters reported last week, reflecting the investment bank’s assessment that the value of the company has diminished following Harvey Weinstein’s departure.
The proceeds from the Paddington 2 sale enable The Weinstein Co to continue to operate until January, the source said. Investment firm Fortress Investment 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 analysing The Weinstein Co’s financial data, the source said. The studio has $375m in debt, including a $45m loan from AI International, 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.