Following weeks of speculation, the bankrupt VFX house behind many of the effects in Oscar winner Life of Pi has reportedly been sold to an Indian buyer. The Los Angeles Times reports that Rhythm & Hues has been sold to a company affiliated with effects and animation company Prana Studios, which beat out other potential buyers like Prime Focus, also based in India, to acquire the company. The news follows the September bankruptcy of Digital Domain, the VFX studio founded by James Cameron, and its subsequent acquisition by India-based Reliance MediaWorks, in partnership with China’s Galloping Horse.
Despite winning numerous awards and accolades for its visual effects over the years, Rhythm & Hues fell into Chapter 11 bankruptcy protection in February, laying off some 250 employees. Later that month, hundreds of VFX workers took to the streets in protest on the day of the Oscars, in the hope of drawing attention to industry working conditions. Former Rhythm & Hues employees also filed a class action complaint against the studio, claiming their contracts were terminated without the proper notice.
Hollywood studios are increasingly outsourcing visual effects work
In order to lower costs, Hollywood studios are increasingly outsourcing visual effects work, leading to a rising number of studios in countries like India, Malaysia, and China. According to The LA Times, the acquisition still needs legal approval, but if it goes ahead, Prana Studios will likely take over a nearly $16 million debt owed by Rhythm & Hues to Universal Studios and 20th Century Fox as part of the deal.