DNEG, the UK-based visual effects and animation house whose clients include Netflix and major Hollywood film studios, has canceled plans to go public amid a broad global downturn in financial markets.
In January, DNEG announced plans to merge with Sports Ventures Acquisition Corp, a special purpose acquisition company (SPAC), in a deal valued at approximately $1.7 billion. The duo had previously expected that to close in the first half of 2022.
On Thursday, the two companies announced the termination of the agreement as a result of “current unfavorable market conditions for SPAC” and other factors. Sports Ventures said it will consider other acquisition opportunities, depending on market conditions and timing.
“Due to headwinds in the SPAC market and general market volatility, we have decided to terminate the SPAC operation with Sports Ventures,” DNEG Chairman and CEO Namet Malhotra said in a statement.
However, Malhotra added: “We are incredibly optimistic about the future of DNEG and the company continues to show impressive financial results, with the announcement of its highest-ever revenue growth rate earlier this week.” He noted the renewal of the DNEG deal announced last month with Netflix, according to which the operator expects to spend at least $ 350 million with the company until September 2025.
DNEG has worked with Netflix projects including the fourth season “Stranger Things”; Rian Johnson “Knives Out 2”; fantasy dramas “School of Good and Evil” and “Avatar: The Last Airbender”; Origin story “The Witcher: Blood Origin”; and the upcoming fantasy comedy adventure ‘Slumberland’ directed by Francis Lawrence. In addition, DNEG Animation is providing animation services for the feature-length animated film “Nimona” scheduled for release by Netflix in 2023.
In 2021, the company won two Oscars and BAFTAs for visual effects for Christopher Nolan’s “Tenet.” Other film and TV credits include “Dune”, “No Time to Die”, “The Matrix Resurrections”, “Ron’s Gone Wrong”, “The Flash”, “Sonic the Hedgehog 2”, “Jurassic World: Dominion” and “The Gilded” Age, “The Wheel of Time”, “Foundation”, “Ghostbusters: Afterlife” and “Zack Snyder’s Justice League”.
Malhotra had previously said that DNEG plans to expand its capacity by up to 40% by the end of 2022, although it is not clear if that is still under consideration.
DNEG was formed through the merger of Prime Focus (established 1997) and Double Negative (established 1998) 2014. The company has approximately 7,000 employees with offices and studios worldwide throughout North America (Los Angeles, Montreal, and Toronto). and Vancouver), Europe (London) and Asia (Bangalore, Chandigarh, Chennai and Mumbai).
(Pictured above: Sadie Sink in Stranger Things 4 on Netflix)
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