Mumbai, July 2: Anil Ambani group company Reliance MediaWorks (RMW) has merged its global film and media services business with Prime Focus Ltd (PFL).
Reliance MediaWorks and the promoters of Prime Focus — Naresh and Namit Malhotra — will each infuse fresh equity capital of Rs 120 crore into Prime Focus Ltd at a price of Rs 52 apiece through a preferential allotment.
The equity proceeds will be used to fund the recent merger of Double Negative, a European visual effects provider, with Prime Focus World, a subsidiary of Prime Focus Ltd.
After the preferential allotment and merger, the existing promoters of Prime Focus Ltd will hold 33.5 per cent in the company, while Reliance MediaWorks will get an equity stake of 30.2 per cent.
The promoters of the two companies have also announced a mandatory open offer in Prime Focus to acquire 26 per cent of its equity at a price of Rs 52 apiece, according to Sebi rules.
The transaction is part of Reliance Capital’s efforts to unlock value from investments in non-core sectors to focus on its key financial services businesses. Reliance Capital is one of the promoters of Reliance MediaWorks
“The proposed transaction reflects a significant step forward in Reliance Capital’s strategy of unlocking value from its investments in sectors other than financial services,” Sam Ghosh, CEO of Reliance Capital.
According to a statement from Reliance MediaWorks, the combination of PFL-RMW and Double Negative will create the world’s largest and the most integrated media services group in visual effects, stereo 3D conversion, animation and cloud-based digital media solutions.
Within India, the combination will bring integrated services to the film industry — from equipment rental and shooting to final digital distribution.
Namit Malhotra will be the executive chairman and Global CEO of PFL.
“We are excited about the transformational growth opportunity created by the powerful combination of the global film and media services business of Reliance MediaWorks and Prime Focus,” Amitabh Jhunjhunwala, group managing director of the Reliance group, said.
The merger is expected to help Prime Focus expand its infrastructure across India, the UK and North America, that includes a total of 1 million sq ft of facilities, including studio facilities in Film City, Mumbai.