Corporate Development

Published: Dec 29, 2021
Updated: Dec 29, 2021

Pole player in VFX, animation

After acquiring the entire stake from IDBI trustees and the Anil Dhirubhai Ambani group (ADAG), the Malhotra family led by Naresh Malhotra now owns and controls 70 per cent in the NSE and BSE-listed Prime Focus (PFL) — the largest independent integrated media services player with offices in 8 cities across 5 countries and 7 time zones.

DNEG

Fitzrovia (London)-headquartered DNEG is one of the key subsidiaries of PFL, which holds a 77.32% stake on a fully diluted basis. DNEG is one of the world’s leading visual effects and animation studios for the creation of feature film, television and multi-platform content. It employs nearly 7,000 people and has offices and studios worldwide. DNEG’s critically acclaimed work has earned it six Academy awards for ‘Best Visual Effects’ and numerous BAFTA and PrimeTime Emmy awards for its high-quality VFX work. It has won the Oscar for ‘Tenet’.

In a recent game-changing development, Londonbased investment firm Novator Capital Advisors LLP (Novator) has invested $ 250 million in subsidiaries of PFL, the parent company of DNEG and personal holding of its founder Namit Malhotra, who is the Chairman and CEO of DNEG and also the Non-Executive Director of PFL. Mr Malhotra will continue in his current role and will increase his ownership stake in the parent company from 35% to approximately 70%, whereas Novator will own a 15% stake in DNEG.

EYE ON GAMING

Expressing his views on the investment made by Novator, Mr Malhotra said, “In my 25 years of experience building a global business, I can say without doubt that I have never seen such an explosion in demand for our services or a better time to form new content creation partnerships. The doubling of my equity investment in DNEG’s parent company is testament to my full commitment and total belief in the opportunity. DNEG is perfectly positioned to strategically align with our clients and partners to create compelling and successful content for global audiences, and as some of our key clients move into new areas such as gaming, our strategy and the opportunity dovetail perfectly.”

He added, “With the backing of Novator, we are taking the next step in scaling and widening the scope of our business to capitalize on this huge opportunity, and I’m confident that this will make us an even stronger partner to our clients in both content services and content creation.”

HUGE MARKET

PricewaterhouseCoopers’ (PwC) annual ‘Global Entertainment & Media Outlook’ recently forecast global streaming revenues to hit $ 94 bn by 2025. This augurs well for the company. On a positive note, Thor Bjorgolfsson, Chairman of Novator, said, “We have identified DNEG as having all of the key components in place to take full advantage of these opportunities. Building on its award-winning legacy, we are backing Namit’s vision to accelerate DNEG’s evolution from a pure services provider to a content production and gaming services powerhouse for the entire ecosystem.” Commenting on the formation of ‘ReDefine’ – a company registered under DNEG — Mr Malhotra explained that “with the launch of ReDefine last year, we expanded our reach to Asian and independent filmmakers across the globe to provide VFX and animation with top international creative standards.”

FINANCIALS

MARQUEE TITLES

Marquee upcoming projects of the company for the current year (FY22) include ‘Venom 2’, ‘Matrix 4’, ‘Unchartered’, ‘Slumberland’ (Netflix) etc. Its order book continues to be promising. The studio rental and equipment rental business have also shown momentum largely on the back of OTT. However, business got impacted by significant disruptions on customer-side productions on the back of the Covid pandemic.

Prime Focus Technologies (PFTL) is another important subsidiary of PFL and is mainly into the global cloud technology business.