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Digital Domain IPO Hits Snag

Venice-based vfx studio Digital Domain, which intended to launch its initial public stock offering this week, has apparently run into difficulty closing the deal at its asking price of 6 million shares at $12 to $14 apiece, reports THE LOS ANGELES TIMES. The pricing of the deal is now "day to day," according to Digital Domain's underwriter, San Francisco-based investment bank Thomas Weisel Partners.

The price could be cut or Digital Domain could raise capital through private equity, the newspaper speculates.

Digital Domain (SPEED RACER, THE MUMMY: TOMB OF THE DRAGON EMPEROR, THE CURIOUS CASE OF BENJAMIN BUTTON) is trying to raise $70 million after expenses.

According to the prospectus filed with the Securities and Exchange Commission, Digital Domain's growth strategy is "to establish early technology leadership" in the convergence between film and videogames. The plan is to expand its operations as both a technology and content provider. The company intends to have a larger ownership stake in animated and visual effects-driven features.

Not only is Digital Domain in the early stages of developing a videogame with two filmmakers, it is also developing its own proprietary realtime game engine, which would serve as the common architecture for the production of animated features and associated games. To that end, Digital Domain "has entered into an agreement with Warner Bros. Pictures to produce a digitally animated 'proof-of-concept' piece for the possible future joint development of a full length animated feature film and videogame" based on the THUNDERCATS animated TV series, to be directed by videogame art director (GEARS OF WAR) Jerry O' Flaherty.

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Bill Desowitz, former editor of VFXWorld, is currently the Crafts Editor of IndieWire.

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