A leading visual effects and animation company announced a SPAC deal Tuesday and laid out its growth plans for investors. Here are the key details.
The SPAC Deal: Award winning visual effects company DNEG announced a SPAC merger with Sports Ventures Acquisition Corp (NASDAQ:AKIC).
The deal values DNEG at an enterprise value of $1.7 billion. The merger includes a PIPE of $168 million. An affiliate of Sports Venture agreed to backstop a portion of the $350 million minimum cash condition of the merger.
The merger is expected to close in the first half of 2022.
About DNEG: Leading technology-enabled visual effects company DNEG has operations across North America, Europe and Asia. The company has over 20 years of industry experience and has won six of the last 10 Academy Awards for the “Best Visual Effects” category.
The company has also won numerous BAFTAs and Emmys for its visual effects work, according to the announcement.
Recent projects DNEG worked on include “The Matrix Resurrections” and “No Time to Die.”
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Growth Ahead: DNEG lays out its growth items as expanding its talent, entering new territories, pursuing acquisitions and entering new segments like gaming and content creation.
The company also mentions opportunities in the metaverse in its deal announcement release.
The company said it has $731 million in its order book and a pipeline from existing relationships that provide “highly visible, recurring revenue streams.” The company said it has deals with the world’s largest content creators, which includes Hollywood studios, production companies and streaming services.
Future projects for the company include:
- “Uncharted” from Sony Corp (NYSE:SONY)
- “Death on the Nile” for Walt Disney Co (NYSE:DIS)
- “Moonfall” from Lions Gate Entertainment Corp (NYSE: LGF-A)
- “Borderlands” from Lions Gate
- “Stranger Things Season 4” for Netflix Inc (NASDAQ:NFLX)
- “Aquaman and the Lost Kingdom” for AT&T Inc (NYSE:T) subsidiary Warner Bros.
DNEG is guiding for fiscal year 2022 revenue to hit $400 million. The company sees adjusted EBITDA hitting $100 million for fiscal year 2022.
Unity Software Inc (NYSE:U) announced in November it was acquiring Weta Digital, a visual effects company founded by “Lord of the Rings” director Sir Peter Jackson in 2021 for $1.63 billion.
AKIC Price Action: AKIC shares are up 1.22% to $9.83 on Tuesday.
Visual effects work on the film "Dune." Photo courtesy of DNEG.
