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Less than 24 hours after The Weinstein Co. board abruptly called off the sale of the embattled company and said it has no choice but to begin bankruptcy proceedings, potential buyer Maria Contreras-Sweet appeared Monday to be resigned to the end of the deal, although it still may not be completely dead.
“I was surprised to read in a publication a letter from TWC representatives that they were terminating our negotiations to purchase the assets of TWC. Based on our discussions, it was my understanding that we were close to signing the transaction documents in a couple of days. Regrettably, it appears that this transaction has now ended,” she said in a statement issued Monday afternoon.
Still, it’s unclear whether Contreras-Sweet is walking away from the sale for good. “Maybe. Maybe not. It’s not clear at this time,” says one insider familiar with the proceedings.
Contreras-Sweet — a former Obama administration official — is leading a group of investors who are proposing to take a 51 percent stake in TWC and install a female-majority board. Ron Burkle, a longtime Harvey Weinstein associate, is a minority investor in the $500 million bid.
Contreras-Sweet received the actual letter from the board only after she had first read of TWC’s decision to scrap the deal in the press.
“While we deeply regret that your actions have led to this unfortunate outcome for our employees, our creditors and any victims, we will now pursue the Board’s only viable option to maximize the Company’s remaining value: an orderly bankruptcy process,” read the board’s tersely worded letter, which was addressed both to Contreras-Sweet and Burkle. In particular, the board said the bidders failed to provide interim financing that the company needs to keep the lights on.
The dramatic turn of events came less than a week after Contreras-Sweet and Burkle met with New York State Attorney General Eric Schneiderman to address his concerns about a victims’ fund and the vision for the new company. Earlier this month, the AG filed a sweeping civil rights lawsuit against TWC, Harvey Weinstein and Bob Weinstein that effectively blocked the sale.
Schneiderman’s office on Monday said it was disappointed to learn the sale was in jeopardy. “Over the past two weeks, we had very productive discussions with both parties about accomplishing the Attorney General’s goals of compensating victims, protecting employees, and rooting out those who enabled years of sexual abuse at the Weinstein Company,” it said in a statement. In particular, his office noted that the buyers had agreed to set up a victims’ compensation fund of up to $90 million.
In her statement, Contreras-Sweet said she was inspired by the #MeToo movement in spearheading the bid to buy the embattled company founded by the Weinstein brothers.
“It is important for me to reiterate the values that have embodied this deal since day one. My initial offer letter dated November 4, 2017, clearly stated my intentions to build a company led by women, to retain the employees, to assume all liabilities and protect small businesses, to create a mediation process for victims and guarantee a litigation fund that would supplement existing insurance coverage. In addition, the cornerstone of our plan was to launch a company that represented the gold standard in governance and transparency,” said Contreras-Sweet.
Her statement continued: “While the contagion of sexual harassment has infested all industries, I’ve been heartened to see the highly influential entertainment industry become the North Star in this remedial movement. This powerful industry touches the hearts and minds of the global population. I wish all the stakeholders the best possible outcome.”
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