DNEG, visual effects studio behind "Tenet", to go public in $1.7 bln SPAC deal (updated)

Prime Focus

25/01/2022 13:13

(Adds transaction details, background)
    Jan 25 (Reuters) - DNEG, the Oscar-winning Hollywood visual
effects studio behind Christopher Nolan's "Tenet", said on
Tuesday it would list in New York through a merger with a
special purpose acquisition company in a deal valuing the
combined entity at about $1.7 billion.
    The company, which has also worked on popular movies
"Inception", "Avengers: Endgame" and "Mission Impossible:
Fallout", has received six Oscar awards for visual effects.
    The deal with Sports Ventures Acquisition Corp  AKIC.O  will
provide DNEG with up to $400 million in gross proceeds,
including $168 million in private investment in public equity,
or PIPE.
    Formerly known as Double Negative, London-based DNEG was
acquired by India's Prime Focus Ltd  PRFO.NS  in 2014. It has
studios in England, Canada, the United States and India.
    DNEG had earlier considered other traditional options to go
public. The company was looking to list in London through an
initial public offering (IPO) in 2019, according to a media
report https://www.reuters.com/article/us-dneg-ipo-idUSKCN1UE1HN.
 
    SPACs are publicly-listed companies formed with the
intention of merging with a private company at a later date. For
the company going public, a SPAC merger serves as an alternative
to a traditional IPO.
    Sports Ventures was focused on finding a target in the
sports, media and entertainment sectors. It had raised $230
million through an IPO in January last year.
    The combined company will be led by DNEG Chief Executive
Officer Namit Malhotra and will list on the Nasdaq. The deal is
expected to close in the first half of this year.

 (Reporting by Sohini Podder and Manya Saini in Bengaluru;
Editing by Maju Samuel and Saumyadeb Chakrabarty)
 ((Sohini.Podder@thomsonreuters.com;))