As the Weinstein Company struggles under the weight of scandal and debt, two competing female-led investor groups are hoping to acquire the studio in an effort to turn its assets into a source of funding for victims of sexual abuse and harassment.
Killer Content, the parent company of the long-established indie Killer Films, and its social outreach wing Killer Impact, have pulled together a group of investors, including Abigail Disney and the New York Women’s Foundation, who are prepared to field a bid for some of Weinstein Co.’s film and TV assets. Maria Contreras-Sweet, former head of the Small Business Administration during the Obama years, is assembling a similar offer, according to individuals with knowledge of the talks.
Weinstein Co. is expected to send out briefing books with details on the company’s financial state to prospective bidders early next week. The company is under pressure to find a buyer as it battles a lawsuit from investor Len Blavatnik’s Access Industries over a $45 million loan that is in default. Weinstein Co. faces the prospect of some or all of its assets being frozen following a scheduled Dec. 13 court hearing on the Access Industries suit. Given the dire state of the company, with more than $500 million in debt and creative and business partners fleeing, a bankruptcy filing may well be the only recourse for the company if a quick sale cannot be arranged.
In addition to Killer Content and the Contreras-Sweet group, media firms taking a deeper look at Weinstein Co. are said to include Viacom, Lionsgate, and MGM. Weinstein Co. has been reeling for nearly two months after the New York Times and New Yorker published exposes alleging a pattern of sexual assault and harassment conducted by company co-founder Harvey Weinstein, who was fired last month. The company and Weinstein are also in the middle of a legal battle over his dismissal.
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Killer Content has lined up several prominent female investors and the New York Women’s Foundation to support its bid. Disney is honorary chairwoman and a past board member of the foundation. The organization works as something of philanthropic venture capitalist, said Ana Oliveira, the foundation’s president-CEO.
“We were approached by Killer Content with an irresistible proposition — to use the assets of the Weinstein Co. to help shift the paradigm and change the rules so we’re not forever in this place where we’re always hearing these stories of harassment,” Oliveira told Variety. “A significant part of the proceeds from the company would go to a fund that would support work on the ground on behalf of victims or to those working to change the cultural norms within corporations and government.”
If Killer is successful, the expectation is that Weinstein Co. would cease to exist as a company. Creative management of Weinstein Co.’s film development and library would be handled by Killer Films principals Christine Vachon and Pamela Koffler, both respected veterans of the indie film biz, while business matters would be steered by Killer Content, headed by CEO Adrienne Becker, and its pro-social unit, Killer Impact. The New York Women’s Foundation, a public foundation with more than 10,000 donors, including blue-chip corporate backers, would help administer the distribution of profits from Weinstein Co. titles to various non-profit organizations.
“The poetic beauty here is that would be almost an alchemic process,” Oliveira said. “Taking the good assets of the Weinstein Company and transforming them into a means of extinguishing sexual harassment.”
Separately, Contreras-Sweet, the founder of ProAmerica Bank, has stitched together a consortium of investors from Wall Street and Hollywood. The group wants to buy the Weinstein Company whole instead of picking off parts in contrast to many of the other potential bidders. The group is said to be composed of largely female entrepreneurs, including several actresses and prominent talent agents.
“I believe we have now reached a crossroads where it is imperative that a woman-led board acquire control of the Company and create content that continues to inspire audiences around the world, especially our young girls and boys,” wrote Contreras-Sweet in her offer letter sent to Weinstein Co. last week.
Contreras-Sweet began assembling the group over the past two or three weeks. She has been in discussions with the Weinstein Company board since early November. The two parties are currently hashing out a price (reports of a $275 million bid are erroneous, insiders say).
No deal is expected this week, but there is a sense of urgency to the negotiations. The Weinstein Co. continues to have serious cash flow issues and the bidders are worried that third-party distributors such as Netflix will try to use the studio’s financial woes to unwind deals. They would also like to prevent a staff exodus. Contreras-Sweet’s group wants to retain the studio’s senior leadership, including COO David Glasser. They do not want Weinstein Co. co-chairman Bob Weinstein to be involved, and they want to ensure that neither he nor Harvey Weinstein profits from the sale.
As part of the sale, the Contreras-Sweet group would set aside funds to compensate women who were abused by Harvey Weinstein. Ultimately the investors believe that the library of Oscar-winning films, such as “The Artist” and “The King’s Speech,” as well as the “Project Runway” franchise still have value, despite the scandal. They’re also impressed with a few dozen projects that are in various stages of development.
Moelis & Company is handling the sale process for Weinstein Co. Moelis and a rep for Weinstein Co. declined to comment.
