In an unprecedented move, Prime Focus Limited has announced the merger of its creative services subsidiary Prime Focus World and Double Negative, one of the largest visual effects services providers to the global film industry.
The agreement will create the world’s largest independent VFX, stereo conversion and animation company serving the Hollywood film industry.
“This is a transformational event; both for the companies involved and for the industry. Prime Focus has proven over the last five years the undeniable benefits of global collaboration; the flexibility of working in different time zones; the coming together of creative talent from across the globe and the ability to leverage tax incentives. We can now bring this together with Double Negative’s unquestionable creative excellence to build a truly formidable offering.” said Prime Focus founder and Chief Executive Officer, Namit Malhotra.
Established in 1998, Double Negative is Europe’s largest independent VFX house with honors including an Academy Award for Inception and BAFTA‘s for Inception, Harry Potter and the Deathly Hallows Part 2.
The transaction will be supported by Standard Chartered Private Equity, Macquarie Capital and AID Capital Partners, all existing investors in Prime Focus entities, and existing bankers across the Group.
The new VFX business, which will trade under the Double Negative brand, will be led by Double Negative’s current management team of Alex Hope – Managing Director and Matthew Holben – Chief Executive Officer.
In addition to the existing creative talent at its London and Singapore facilities, Double Negative will be opening in Vancouver by bringing key talent and technology besides having complete access to all production and technology infrastructure in India.
“We have ambitious plans to build on what we’ve achieved in VFX over the last fifteen years. This deal allows Double Negative to develop into a truly global operation that provides great work for our clients and great opportunities for our staff.” stated Double Negative’s management team of Alex Hope and Matthew Holben.
For Prime Focus the deal offers a clear path to growth where revenues would have more than doubled. With a combined order book of US$ 150 mn (INR 900 crore), the company will be in a strong position to sustain growth, generate free cash flows, pare down debt by thirty to forty percent over the next four to six quarters and offer significant value to its stakeholders.
The transaction is subject to customary closing conditions and expected to close in the coming weeks.