VFX Studio DNEG Nixes $1.7 Billion SPAC Deal, Citing ‘Market Volatility’

variety.com:

Todd Spangler NY Digital EditorDNEG, a U.K.-based visual effects and animation house whose customers include Netflix and major Hollywood film studios, has called off plans to go public amid the broad global slump in financial markets.In January, DNEG had announced plans to merge with Sports Ventures Acquisition Corp., a special purpose acquisition company (SPAC), in a deal valuing the company at $1.7 billion.

The duo had previously expected that to close in the first half of 2022.On Thursday, the companies announced the termination of the agreement as a result of “current unfavorable SPAC market conditions” and other factors.

Sports Ventures said it will consider other acquisition opportunities, subject to market conditions and timing. “Due to the headwinds in the SPAC marketplace and general market volatility, we have decided to terminate our SPAC process with Sports Ventures,” DNEG chairman and CEO Namit Malhotra said in a statement.However, Malhotra added, “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.” He pointed to the deal renewal DNEG announced last month with Netflix, under which the streamer expects to spend at least $350 million with the company through September 2025.DNEG has worked with Netflix projects including “Stranger Things” Season 4; Rian Johnson’s “Knives Out 2”; fantasy action-dramas “The School for Good and Evil” and “Avatar: The Last Airbender”; origin story “The Witcher: Blood Origin”; and upcoming fantasy comedy-adventure “Slumberland” from director Francis Lawrence.