Female investor group turns the tables on the Weinstein Company

The ongoing saga of whether the Weinstein Company will file for bankruptcy or sell its assets continues with another interesting turn. It has been announced that an investor group led by businesswoman Maria Contreras-Sweet has decided against proceeding with its planned purchase of the firm’s assets.

Unsurprisingly, the company has struggled since the allegations of sexual misconduct by its co-founder Harvey Weinstein became public in October 2017. Since that time, it has sought to try and survive by talking to private equity investors, none of whom seemed willing to strike a deal. The company has sold the distribution rights to the children’s film Paddington 2, whose creators, not surprisingly, were keen to distance themselves from the now tainted brand.

The deal that Ms Contreras-Sweet was trying to strike for a reported USD 500m was said to include an allocation of USD 90m to a victims’ compensation fund. While this is admirable, I can’t help but feel the figure seems a little on the low side given the revelations so far and the multi-million-dollar law suits that will result from the allegations. However, this is a moot point now, given that the deal has fallen through as a result of the company having higher liabilities than initially thought, according to a source close to the deal.

Buyers haven’t exactly been rushing forward and it is quite ironic that the potential acquiror which seemed the most interested, an investor consortium led by a woman with plans to install a predominantly female board, has now stepped back.