French technology and media multinational Technicolor has acquired another major visual effects producer: London-based advertising studio The Mill for $293 million.
It’s the latest in a series of acquisitions aimed at strengthening Technicolor’s portfolio. Earlier this year, Technicolor acquired French animation and post-production company, Mikros Image. Two months before that, Technicolor acquired French independent animation producer, OuiDo Productions.
“In acquiring The Mill, we are executing on our Drive 2020 strategic objective of enhancing our market position in visual effects while improving profitability and revenue growth concurrently with accelerating deployment of emerging technologies,” said Technicolor CEO Frederic Rose in a press release. “In The Mill, we have found a company that aligns with our focus on excellence in talent, technology and operational performance. It is a perfect fit.”
Since its founding in 1990, The Mill has made a name for itself as one of the advertising industry’s largest visual effects studios, receiving honors for its commercials for clients like Audi and DirectTV. The Mill has also made an impact in feature films before it switched its focus to commercial work. It has created vfx for franchises like Tomb Raider and Harry Potter while earned an Oscar for its vfx on Ridley Scott’s Gladiator.
With operations in London, New York, Los Angeles, and Chicago, The Mill and its 1,000-plus industry awards extends Technicolor’s global reach. According to Technicolor’s announcement, its acquisition of The Mill:
Establishes leadership positions for visual effects and digital creation across all segments of high-end content, including cinema, TV and advertising;
Reinforces Technicolor’s strong portfolio of brands including MPC, Mr. X and Mikros Image servicing a broad range of customers across 10 global locations;
Brings significant talent and expertise around emerging technologies such as virtual reality content that will enable Technicolor to enhance its technology platform across the entire industry;
Adds significant financial contribution with a business that has grown revenues at a 16% CAGR since 2009 to reach €135 million in 2014 while delivering EBITDA margins of approximately 20%;
Allows Production Services to better balance its portfolio through increased exposure to advertising and strengthens the financial profile of the Entertainment Services segment. With this acquisition Production Services accounting for approximately 40% of Entertainment Services revenues.
Technicolor’s newest acquisition continues a stretch of consolidations in the VFX industry that shows few signs of slowing. In July, VFX houses Cinesite and Image Engine merged. A scant week before that, VFX producers Prime Focus World and Double Negative merged as well. Who’s next?