Prime Focus Limited has informed the Exchange about issue of Securities on a private placement basis through preferential allotment
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Prime Focus Limited's board has approved issuing up to 46.27 crore equity shares at INR 120 per share (face value INR 1, premium INR 119), for a total consideration of about INR 5,552 crore. Of this, 43.01 crore shares (INR 5,161.5 crore) will be issued as a share swap to acquire additional shares in step-down subsidiary DNEG S.a.r.l., Luxembourg (VFX and animation firm with turnover of USD 425.7 million in FY25), and 3.25 crore shares (INR 390.5 crore) will be issued for cash to raise funds. The issuance is to 16 allottees, including promoter group entity A2R Holdings (which will increase its stake to 53.46% from 48.75%) and notable investor Novator Capital Limited (which will get a 14.40% post-issue stake). Post this, Prime Focus's direct and indirect holding in DNEG will rise to 88.28%.
The share-swap component is largely non-dilutive in cash terms but will significantly expand the share base (over 46 crore new shares), likely leading to share price dilution. The deal consolidates Prime Focus's control over its key VFX subsidiary DNEG, which could simplify group structure and future earnings reporting, but existing shareholders will see their proportional ownership reduced.