DNEG agrees to acquire Prime Focus Technologies

DNEG has entered a memorandum of understanding to acquire Prime Focus Technologies’ business.

The transaction is still subject to several checks, including customary due diligence, finalization of the acquisition structure and valuation of the business, receipt of requisite corporate approvals (including from Prime Focus Limited, parent company of DNEG and PFT) and lender consents, and execution of the definitive agreements.

When the deal is concluded, DNEG will add the media workflow and automation software suite, CLEAR, and purpose-built AI platform for content management, content creation and monetization, CLEAR AI, to its portfolio. This aims to enable DNEG to expand into media tech and distribution services, including fulfillment, localization and marketing, providing an end-to-end solution for media and entertainment clients. It also merges parent company Prime Focus’ visual effects and animation business with its cloud technology business.

The business includes the intellectual property of the company, and its 1,700 employees (including approximately 300 software engineers) located across North America, the United Kingdom and India.

Namit Malhotra, DNEG chairman and CEO, said: “DNEG is the entertainment industry’s go-to premium turnkey solutions provider thanks to organic market share expansion and key, strategic acquisitions, including today’s MOU with PFT. In concert with DNEG’s deals for several lines of production and post-production services from Prime Focus Limited earlier this year, and our latest studio opening in Sydney, DNEG is truly a global, 24/7 force in the business. DNEG continues to offer unmatched quality, innovation and end-to-end capabilities to meet the visual effects, animation, pre- and post-production, distribution fulfillment services, and media asset management needs of all clients around the globe.”

He added: “Bringing PFT’s business under the DNEG umbrella is the next logical step for our company to further develop its expertise across the content lifecycle, through post-production, content management and distribution. Consequently, DNEG has secured another avenue for future growth and an ability to innovate faster and provide more value to clients. Together, we will realize adjacent growth opportunities and more deeply align DNEG with our customer base for longer term collaboration and more transformative projects in the future.”

Ramki Sankaranarayanan, founder and CEO of Prime Focus Technologies, commented: “Prime Focus Technologies is thrilled to be joining DNEG and becoming part of the company’s global solutions offering for an impressive and growing array of clients and operations.

“PFT is committed to offering customers digital transformation solutions that help automate the content supply chain. This transaction will be a positive step forward for both our existing customers and for prospective clients. The transaction with DNEG will enhance PFT’s financial strength and stability and help in building longer-term relationships with our clients. DNEG provides PFT a halo of credibility and success, with its strong studio partnerships and relationships that we can leverage into growth opportunities in the future.”