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Prime Focus to buy out 2 US entertainment cos

Published on Thu, Nov 29, 2007 at 10:12 | Source : CNBC-TV18

Updated at Thu, Nov 29, 2007 at 13:25

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Namit Malhotra , MD of Prime Focus said they are in the process of completing the US buyout, which will be a cash deal.

Focus will acquire 100% stake in both Post Logic Studios and Frantic Films. The company is in the process of raising USD 55 million via an FCCB issue.

Excerpts of CNBC-TV18's exclusive interview with Namit Malhotra:

Q: Can you clarify this or confirm this for us, are you indeed buying Logic studios and Frantic film for USD 43 million?

A: We are in a process of completing our acquisition on both these companies and the total value is going to be USD 43 million.

Q: You'll pay cash or issue stocks or do you have enough capital in place for this?

A: It is a cash deal. We are right in the midst of our fund raising, we should be well in time for that.

Q: How much stake are you picking up in percentage terms and what do both these acquisitions bring o Prime Focus?

A: Both these companies are going to be acquired 100%. the structure of the transactions are still not be established, it's going to be part of our group strategy. We are not at the stage where we can reveal the exact structure of the transaction. But the companies are going to be bought 100%.

Q: Could you give us some sense of your capital-raising plan? How much money will you raise exactly and what kind of dilution, if any, will it entail?

A: We have mandated our investment bankers to the tune of USD 55 million by virtue of an FCCB and we are on the closing stages of that. Again, depending on the market conditions, the valuation will sort of obviously be visible at the point at which the deal is done.

Q: What exactly are you going to finalised by way of modality? Are you saying that these two acquisitions may not be the part of the listed entity?

A: Like I said, it is premature to comment on which way these would be structured based on our overall international strategy. We are in the middle of getting all our consultants in terms of advice and how we should look at structuring these acquisitions.

Q: What kind of revenues do these companies, Frantic Films and Logic Studios, have on an annual basis?

A: I'm afraid I'm not in a position to reveal that at this stage, but they do form a sizeable scale of our consolidated business revenues. So yes, they are fairly large relation to our current revenues.