EXCLUSIVE: The first true bid for the assets of troubled The Weinstein Company will be a difficult one to beat for any bidders thinking of getting into the fray. It starts with the woman fronting the bid, a Mexican immigrant who served in the Obama cabinet and has built banks and businesses and has four bona fide backers, some in Silicon Valley, ready to pony up $275 million in funds that are at the ready and will not have to be raised.
Those funds would take TWC’s long-suffering investors out of the equation, and far exceeds the $150 million-$175 million that Colony Capital offered in a bottom-feeding bid that was fed to the press as cataclysmic when the board rejected it. The new bid also means that TWC would not have to close the bridge loan with Fortress, with the proceeds from the U.S. sale of Paddington 2 sufficient to keep the company running while the bid comes through. Also important and a disappointment to several publications waving the pom-poms for it, TWC should be able to divert a bankruptcy filing.
The bid by Maria Contreras-Sweet, former head of the U.S. Small Business Administration for the Barack Obama administration, has a plan that would leave 51% of the company controlled by women. She’s got four backers behind her as well as Loeb & Loeb, Ernst & Young and FTI’s Roy Salter as advisors. This could erase what seemed like an indelible stain of scandal and could reignite the company by removing the stigma on assets that include library titles, the Kevin Costner-Taylor Sheridan series Yellowstone, movies like the recut Benedict Cumberbatch-Michael Shannon-starrer The Current War and the Lin-Manuel Miranda and Quiara Alegría Hudes musical In The Heights, as well as numerous other series and films. It might make possible the David O Russell-directed series with Robert De Niro and Julianne Moore, which was scrapped at Amazon even though it had a two-season commitment.
Deadline got hold of the proposal letter and you can read it below. Moelis & Co is handling the sale. But a couple of things. The Wall Street Journal, which was leaked the Contreras-Sweet bid, reported that Gloria Allred has blessed it. She’s not part of the consortium proposing to take over the company; she is repping several women who’ve accused Harvey Weinstein of wrongdoing and has already filed civil suits. What her endorsement means is that the bid comes with properly set aside contingency funds to make whole the coming wave of plaintiffs. Deadline reported that was the plan all along, to set aside funds that would be paired with insurance policies to handle claims against Weinstein. The White Knight bid also calls for staff to continue to be employed. Likely gone will be what is left of the board of directors, which approved an unconscionable contract re-up for Harvey Weinstein that ostensibly made it impossible to fire him for cause despite all the scandalous reported wrongdoing, as long as he funded settlements to make misbehavior and potential scandals disappear.
While numerous potential suitors including Lionsgate and MGM mobilizing, the leaders might well push other bidders away from the table; in Hollywood right now, appearance means everything, and it will be a daunting task to best the amount and terms offered by Contreras-Sweet. The Board of Directors might have hoped for $300 million or more, but it’s hard to imagine it’s going to get any better than this.
Here is Contreras-Sweet’s offer letter, which is now making the rounds in the financial community: