Visual effects and animation firm DNEG has called off plans to go public through a merger with special purpose acquisition company (SPAC) Sports Ventures Acquisition Corp.
In a statement, the companies said they had decided to terminate the business combination agreement – which had been announced in January - as a result of current unfavorable SPAC market conditions and other factors.
Alan Kestenbaum, chief executive officer and chairman of the board of Sports Ventures, commented: “Due to current SPAC and equity market conditions, it was mutually determined that the best option for all parties at this time is to terminate the transaction. Namit and his team are leaders in the market, producing stunning and award-winning work that swept the awards this year. DNEG has a bright future and we wish everyone there much success.”
Namit Malhotra, DNEG chairman and CEO, said: “We feel incredibly optimistic about DNEG’s future and the company continues to demonstrate impressive financial results, with our highest-ever revenue growth announced earlier this week. Our strong pipeline reflects the significant demand for our industry-leading visual effects and animation services, as evidenced by our recently announced multi-year deal extension and VFX services renewal agreement with Netflix through 2025.”
Sports Ventures will consider other acquisition opportunities, subject to market conditions and timing.
DNEG employs nearly 7,000 people with worldwide offices and studios across North America (Los Angeles, Montréal, Toronto and Vancouver), Europe (London) and Asia (Bangalore, Chandigarh, Chennai and Mumbai).
Its recent credits include Stranger Things Season 4, Uncharted, Sonic The Hedgehog 2 and The Matrix Resurrections.
In a business update this month, DNEG said it generated revenue of $409.3 million and Income of $39.3 million for the full-year ended March 31, 2022.