DNEG to Raise $200 Million from United Al Saqer Group, Valued at $2 Billion

Prime Focus announced on Tuesday that its subsidiary, DNEG Group, will secure up to USD 200 million in funding from United Al Saqer Group (UASG) based in Abu Dhabi. This investment values the London-based DNEG at USD 2 billion, according to an official statement. The funding process will span two years.

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Following the announcement, Prime Focus shares dropped by 8.84%, closing at Rs 132.95 on the BSE. This decline was notable against a minor 0.04% dip in the benchmark index. In FY24, DNEG reported a turnover of Rs 3,524 crore, which constituted 82.81% of Prime Focus group's consolidated turnover.

Investment Strategy and Future Plans

The investment from UASG aims to boost DNEG's strategy for innovation and diversification. The group plans to transition from solely providing visual effects services to becoming a content production and AI-powered technology partner across various sectors. As part of this strategic move, DNEG will establish a visual experience hub in Abu Dhabi, which is expected to create numerous jobs in the region.

DNEG will also fully activate its technology division, Brahma, which aims to democratise photo-real content creation for various applications. This initiative is part of the group's broader strategy to enhance its technological capabilities and expand its service offerings.

Leadership and Governance

Namit Malhotra, the chairman and CEO of DNEG Group, will retain his current position. He will be joined on the board by Nabil Kobeissi and Edouard Zard from UASG, as well as Prabhu Narasimhan from NaMa Capital, a significant investor in DNEG.

Prime Focus disclosed in a regulatory filing that two separate agreements have been signed for this fundraising effort. Of the total USD 200 million, USD 100 million will be received by July 7. An additional USD 10 million will be subject to mutually agreed timelines and conditions, while the remaining USD 90 million will be disbursed over the next two years under specific terms and conditions.

The strategic investment from UASG is expected to significantly impact DNEG's growth trajectory. By expanding its technological capabilities and diversifying its service offerings, DNEG aims to solidify its position as a leader in visual entertainment technology.

This funding round marks a pivotal moment for Prime Focus and its subsidiary DNEG. The financial boost is set to drive innovation and job creation while enhancing their market presence globally.