Titanic and Avatar-famed Hollywood film-maker, James Cameron’s co-founded, visual effects and animation company, Digital Domain would now have an Indian part-owner in Anil Ambani, who, along with Chinese company Beijing Galloping Horse, has acquired the bankrupt firm.
Reliance Anil Dhirubhai Ambani Group-controlled film and media services company, Reliance MediaWorks (RMWL), has jointly bid with Beijing Galloping Horse Film & TV Co, sources close to the development confirmed, to Business Standard. The visual effects company, it is learnt, has acquired for $30 million. While Reliance would hold 25 per cent stake, the majority 75 per cent would remain with Galloping Horse.
Though the details of the bid would be announced later this week, it was result of Digital Domain filing for bankruptcy earlier this month. Digital Domain runs operations in Los Angeles and Vancouver. Amid media reports, the company has $14 million in debt but $50.7 million in losses as of 30 June.
When contacted, a Reliance MediaWorks spokesperson refused to comment.
Digital Domain was founded in 1993 by Cameron along with Stan Winston and Scott Ross. So far, it has delivered innovative visuals for more than 90 movies including Titanic, Pirates of the Caribbean: At World’s End, the Transformers trilogy and Tron: Legacy.
Interestingly, both Reliance and Galloping Horse have had existing partnerships with Digital Domain since last year. In July 2011, Reliance had partnered with Digital Domain to create a digital production pipeline.
The deal allowed Reliance to own the studios in Mumbai and London while Digital Domain managed the facilities. The studios were offering post-production services for movies, TV shows and commercials.
However, RMWL itself is in need of capital infusion as its net worth has completely eroded. It has already filed, with the Securities and Exchange Board of India (SEBI), for a rights issue to raise Rs 600 crore. It has also signed an indicative non-binding term sheet with a private equity fund to acquire a substantial minority stake in Reliance MediaWorks' film and media services division for an investment of Rs 605 crore.
RMWL’s net worth had eroded to Rs 37.81 crore as on 31 March 2012 from Rs 666 crore as on 31 March 2008. The company's net worth further eroded as it reported a loss of Rs 91 crore in the quarter ended 30 June 2012. In August, it separated its businesses into two divisions – film and media services, and film exhibition.
Reliance MediaWorks' market capitalisation is Rs 315 crore based on Friday's closing price of the company's shares. Its shares closed at Rs 68.50, up 2.93 per cent.