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UPDATE, 8:28 PM: Rhythm & Hues just confirmed Deadline’s report in a press release. The VFX studio says it expects a “competitive auction” on March 27, which will be decided in court on March 28. But don’t count JS Communications out yet: I’m told they’re still exploring their options and may still throw their hat into the ring. “I looked at the company and due to the nature of this business, one missing component was cooperation from the studios because the work comes from them”, JS Communications’ David Shim told Deadline, adding that he’s “still working to have a dialogue with the studios”.
PREVIOUS EXCLUSIVE, 6:57 PM: JS Communications was approved earlier this month as a stalking horse bidder in the ongoing Rhythm & Hues bankruptcy case, which would have guaranteed a minimum bid in the VFX shop’s upcoming auction. But the South Korean media company confirmed to Deadline that it failed to submit a firm purchase agreement for Rhythm & Hues’ assets by today as mandated by the court. JS Communications’ Shim explained the move to Deadline in an email: “In part due to the difficulties in securing cooperation and support from the Studios as of today, we will not be submitting the Asset Purchase Agreement today… It is very regrettable that we had to come to this decision at this point (barring any favorable changes)”. Sources close to the situation tell me other unnamed potential buyers are circling; bids must be submitted by Friday ahead of the March 27 auction.
Related: Potential Rhythm & Hues Buyer Gets Stalking Horse Approval
Related: Rhythm & Hues Hoping For Quick Sale
Related: Rhythm & Hues Has 200 Job Openings – In Taiwan: Report
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“In part due to the difficulties in securing cooperation and support from the Studios as of today”
Which “Studios”? R&H? If not them, then the movie studios?
Why do the movie studios have a say in this?
To “Confused”…
Yes, the movie studios (Fox, Universal, WB, etc.)
I expect it matters because any potential new owner would want to know that there will be future income in the form of contracts (no official commitment, just a vote of confidence).
And I imagine the studios – in a continued sign of their lack of honor – won’t even return the call.
The studios that give R&H the work. R&H have, effectively, defaulted on delivering the work they were contracted do. The studios probably have no faith in the business model and management of the company. Buying an R&H with no clients is not the most brilliant move.
R&H in-house software has to be worth a lot, really surprised that the Korean company did not leave at least a bid for that.
R&H has been doing the most advanced CGI animals with in-house software since “Cats & Dogs”, and that was ten years ago.
Tools are useless without the artists to use them. They evolved with the facility and once that talent scatters, its just hard drives full of code.
The VFX business model wasn’t put in place by grownups who build value into their companies or that developed and protected procedures and IP.
The artists will move on and work the R+H skill and toolset into the creative culture and toolkit of their next longterm employer.
These studio suckers are ruining the vfx industry. Fuck them
This is all irrelevant unless and until all of the VFX companies stop their relentless race to the bottom. This in turn depends upon the VFX artists developing a collective backbone and not allowing themselves to be subject to absurd working conditions and deadlines. And yes, as part of the process, work will be lost overseas. But that is just part of the pendulum’s path. Wait until the first tentpole eff-up when a slave labor overseas sweatshop cannot meet a deadline, causing executive heads to roll. Welcome back to America fellas. So much has changed while you’ve been away.
Having no faith in the business model or the management is irrelevant. R&H has consistently delivered world class work (i.e. life of pi) on time and on budget for over a decade. Their current situation is clearly a result of the industry wide troubles, otherwise you wouldn’t have seen so many other fx companies in the same situation. I hope the studios wake up to find no one anymore who can deliver the work they need. That will switch this mess to a more balanced market. Not a sellers market or a buyers market, but a Fair market.