And The Rhythm & Hues Auction Winner Is…

Prana Studios:

Variety – Prana wins auction for Rhythm & Hues

Hollywood Reporter – Prana to Acquire Rhythm & Hues

Deadline – UPDATE: Prana Studios Wins Rhythm & Hues Auction

LA Times – Rhythm & Hues sold to Indian buyer

WSJ – Winner Emerges in Rhythm & Hues Bankruptcy Auction

I questioned whether Prana had the capital to sustain a company like R+H. It turns out they are backed by some deep pockets including Mukesh Ambani who owns Reliance. Reliance Mediaworks own’s a stake in Digital Domain making R+H distant cousins if bankruptcy proceedings follow through.

Is it redundant to own 2 competing VFX facilities? Both have particular strengths: R+H is a leader in character animation and animals while DD is excellent at FX , compositing, and digital humans. Perhaps a merger might be prudent?

You never know these days. In the mean time, here’s hoping things turn out for the best for the workers at R+H and the former workers get paid.

Soldier On.

40 Responses to And The Rhythm & Hues Auction Winner Is…

  1. Andreas Jablonka says:

    Icy meet Nuke: Past meet Future. That would be a merger of Giants!
    Lets see how fast they will reduce the El Segundo Staff:/

    • Get Real Soldier says:

      To be fair, let’s consider the alternative. If there were no bidders… R&H completely closes and ALL are out of work.

      The new owner will have the option to reduce overhead. Certainly, many currently employed will be impacted…but, for now at least…not the entire company.

      That being said, the new R&H (Prana) will seriously strive to cover its investment two ways. The first will be most probably to cut jobs and overhead at all the levels. And, the second way this may be accomplished is with short term underbidding to keep cash flow active. Hope not…but, it is a strong possibility based upon R&H current job flow status, and Prana’s ability to convince the studios that all is well with the new R&H under their management. They must make the case that it will be equal or better under their management.

      Bankruptcy proceedings extend beyond the immediate debtors/creditors/owners issues, and the process often leaves a wake of additional issues and concerns.

      In any case, happy to see that R&H is not completely folding at this time. And, that is a good thing.

  2. BrrrrrapBrapBrap says:

    What does this mean? Is it good, bad, or meh?

  3. BrrrrrapBrapBrap says:

    My point is, they are backed by deep pockets… so what!!?!?!?

    At what point will nature take it’s course with them too? Any bets on that? Is bigger better? I don’t see that solving anything until the fundamentals are handled.

    Unless the model is changed at the studio level to profitable levels… Why would anyone invest in a vfx company. If VFX companies truly don’t make profits. I still don’t get it. And I know I can’t be that dumb.

  4. mukesh ambani backs reliance industries which invests in prana
    Anil ambani has reliance entertainment, which has digital domain…They were partners till a while back and have separated their interests , Mukesh is the more prudent of the two . They will never merge up.

  5. AniMatters says:

    As far as the investors are concerned, younger bro Anil bought Digital Domain, so grumpy Elder brother Mukesh felt ‘how dare he..’ and hence he bought an Oscar company!!.. that’s all what matters to them..
    Prana is renowned for their dirty In-house politics and screw ups. It would be fun to watch how they distribute work amongst LA, India, Malaysia, Vancouver and Taiwan ..and mind you, there are 3 huge setups in India(inclusive of Prana).
    seriously, as I see, ..R & H is in bigger shit now..Kind’f deep inside deeper shit. God bless “the original Rhythmn and Hues”!! ..

  6. Well, the VFX LA artists are not moving to India!!! VFX success is a complex process and it requires many talents of each individual who has raw talent to begin with that’s been honed over many years with lots of polishing. It took experience and failure for the talent to reach perfection in what they do. It will be hard to replicate that in an instant. The remaining VFX houses will prosper sooner than later And should gear up to handle the big studios requests and an uptake in staff! Get your business plan in order, hire a shark to deal with the studios and get your financing lined up! The remaining studios are in for a big surprise.

    Artists, get yourself into a guild!

  7. Michael says:

    With all the news, not one mention of the staff who have not been paid. I really could care less about the sale or infusion of capital unless I hear that the artists have been satisfied and guaranteed payment for work.

    • Dank says:

      I agree, the laid off with no pay artist are getting thier money? And when? Most have been screwed. Also I should suggest everyone sign then damn union cards.

  8. vfxmafia says:

    How does a company who brings you “Koochie Koochie” and Space Chimps 2 afford to buy R&H?

    • BrrrrrapBrapBrap says:

      This is where I’m lost too.

    • tazzman says:

      They are either
      A) Profitable

      B) Assuming more debt with this purchase.

      A quick glance at the profitability in the fx industry right now leads you to guess which answer?

      • vfxmafia says:

        Id choose B….which means that they are timebomb of debt.

        and add they aren’t very bright ……because they will realize that they just purchased an empty husk of a company unless they keep the people who constantly fix all the bugs in that renderer they use……or all the patches in the pipe….or the fur artists who make that fur look good…..R&H seemed like alot key people making the most..with some limited tech…..

      • McCookie says:

        Why would anyone buy a vfx studio right now?

        Except these men buy bigger toys than a joeblow blowing paycheck friday night.

        They just bought into an industry getting it’s name below craftservice. That’s a fixer in real estate terms.

        Product is too expensive and clients have nothing to say on their end about how they acknowledge culpability. And being a part of the solution.

    • VentureCapital says:

      Prana itself didn’t buy R&H. The investors behind Prana, who are fantastically wealthy, bought R&H through a holding company. R&H and Prana will become sister studios operating independently but answering to the same group of investors.

  9. VFX_Boom says:

    What’s the word on how Prana treats their artists in India? That will tell you you how things will go in the near future for Rhythm and Hues.

    Anyone?

    • VFX saint says:

      Prana is more of an Parliament house & less of an animation studio. If you are more of an Politician and less of an animator, chances of your survival is higher.
      That’s a company where one’s growth depends on his/her adaptability to ass licking and manipulation!..ovr there, ass-licker’s rulz!..and yeah!, specially female members have a good career option there. Doesn’t really matter whether they r talented or not till they have the ‘essentials’ and the ‘willingness” to u know what..hehehe, .. seriously, its a fucked up place for a new recruitment. Funny part is that, they themselves have not earned any profit yet, and were on the brink of having layoff’s,. and all of the sudden they pop up as a buyer!!..funny.:)

      • tazzman says:

        Oh wow. An unprofitable studio buys another and assumes more debt. Uh oh.

      • vfx_gypsy says:

        Looks like one of those ‘female’ members is now working in ILM , Singapore . She has an important Mananger position in this company and seems to be pissing off quite a lot of people here. Many have quit just by stating that they can’t work with her anymore. Hope this will be her last stint at vfx jobs.

  10. vfxNuclearization says:

    can somebody please throw a fucking nuclear bomb on this fucking india so they stop bothering the world? thanks

  11. VFX saint says:

    Prana is more of an Parliament house & less of an animation studio. If you are more of an Politician and less of an animator, chances of your survival is higher.
    That’s a company where one’s growth depends on his/her adaptability to ass licking and manipulation!..ovr there, ass-licker’s rulz!..and yeah!, specially female members have a good career option there. Doesn’t really matter whether they r talented or not till they have the ‘essentials’ and the ‘willingness” to u know what..hehehe, .. seriously, its a fucked up place for a new recruitment. Funny part is that, they themselves have not earned any profit yet, and were on the brink of having layoff’s,. and all of the sudden they pop up as a buyer!!..funny.:)

  12. TD_says_Goodbye_VES says:

    After reading @VFXLAW’s tweet this morning reminding us of the irony that Jeff Okun is Chair of the VES and also an executive at PRANA helping move work offshore to India, followed by the comments about working conditions at PRANA above and in other posts by our Indian worker colleagues, my team and I have talked it over, and 12 of us have sent letters today resigning from the VES.

    We do this not because Mr. Okun has done anything morally wrong, but because it is clear that the VES is not capable of taking the high ground and providing leadership, even so far as honoring best practices and excellence in the field.

    There is not enough room or energy in our field right now to have our only widely subscribed membership organization take our money and our time to honor filmakers like Ang Lee who clearly do not respect us or dress up in rented monkey suits so we can buy the studio VFX executives dinner and stand on stage and thank them publicly as their business policies destroy our business and our livelihood. To have the chairman of the VES also be responsible for yet more outsourcing, and for him to be a manager of a company with abusive labor practices, is again, not his fault or responsibility, but sends the wrong message at this critical time.

    If any of you feel the same way, you can join the twelve of us who have sent our letter of resignation to the VES. We would rather put our limited energies and money into a trade association like that championed by Scott Ross, which could bring about some good, and also give awards and honor excellence, than a vanity club for VFX whose leadership seems to consistently set a bad example for what should be our best business and employer practices.

  13. Get Real Soldier says:

    Sadly, although one can certainly debate the specifics, this post is probably really depressing for the many who joined VES for other reasons.

    “Actions speak for themselves…it is when the motivations for these actions come into question that problems will arise”.

    Lastly, a single organization can do business issues, awards and honor excellence…yet, there is always a battle for the ‘issue of the day’, so it is often better to have an honorary entity and business entities. That being said…whatever works is best.

    Do not think VES is dead or will die, but it appears that much like the visual effects industry itself, their current business model is not working.

  14. Hi there pancakes.... says:

    India and China are desperately trying to buy out US Media and telecom companies. It’s no surprise the regulatory commissions in the states look the other way. It’s funny how people whine like little girls about FOX News yet give it about 5 years and we’ll be watching Chinese controlled news.

    Ironic how the underpaid slave shop workers will now be in control. Alarmist? Yes. Conspiracy? Maybe. Just start looking at the facts and opening your eyes. A lot of these Chinese (and Indian) companies are being funneled money to buy US and Euro assets. WAKE UP.

    • Amirs Club says:

      Your point Pancakes? Im awake and see lots of politics happening behind the scenes with Prana, VES and the Studios.
      Yummy. 75% off on vfx work with the R&H pipeline. The future for american vfx’s artists is not looking good. Good job to the people that helped tank another industry that we dominated.

  15. Correction says:

    Mukesh Ambani is not involved in Reliance Media works in any way. He is the older, wealthier brother of Anil Ambani. There is no relationship with R&H/Prana and DD whatsoever. Might want to check your facts before writing.

  16. amit says:

    Admin mukesh ambani is not the owner of DD & Reliance studeo.both r owned by his highly competetive brother anil ambani.
    There is no any connection.

  17. Abby Hoffmania says:

    I am willing to bet that John Hughes isn’t going anywhere. The Taiwan deal is his baby. Even John himself said that Rhythm wasn’t that deep in the hole… all things considering. So what is Rhythm worth? Rhythm is worth a whole lot to Taiwan. Considering the shift from Hollywood to China is happening. 9 screens a day open in China. This is a BOOM and Rhythm is riding the biggest wave ever.

  18. vfxINDIA says:

    http://www.millenniumpost.in/NewsContent.aspx?NID=24515
    “.Prana Studios Inc, which was founded in 2003 by Arish Fyzee, Kristin Dornig and Pankaj Gunsagar, is backed by a group of investors including Anand Mahindra and Mukesh Ambani”

  19. Did you know that ... says:

    Jeffrey Okun is Prana’s senior vice president of visual effects,
    as well as the Chair of the VES?

    • Abby Hoffmania says:

      what do people get out of VES anyway? Screeners? It’s all pageantry. Seems to me, that it stands for nothing. So Jeff stands for nothing…I am not disappointed. He seems to be doing a great job… at doing nothing. No conflict there.

  20. […] VFX Soldier – And the Rhytm & Hues Auction Winner Is… […]

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