*According to the Associated Press, the company responsible for creating the Tupac hologram filed for a Chapter 11 after going public less than a year ago and agreed to sell the core of its business to a private investment firm for $15 million.
Founded by James Cameron, Digital Domain Media Group Inc. is best known for big productions like “Pirates of the Caribbean” and “Transformers.” Despite its tremendous track record of over 90 films, the company was “running out of cash,” says Chief Restructuring Officer Michael Katzenstein.
Court documents state the company had violated cash and debt requirements set by lenders and even attempted to save the company by seeking outside investors, but wasn’t able to make money magic.
The company went public 10 months ago, selling shares at $8.50, below the expected rate of $10-12. By spring the shares went down to $5 and then back up to $9.20 because of the Tupac appearance. But recently, the shares went down as low as 44 cents.
As of June 30, the company had total assets of about $205 million and liabilities of about $214 million.
Digital Domain, based in Port St. Lucie, Fla., has studios in California and Canada that create digital visual effects, animation and digital production for the entertainment and advertising industries. The company had spent the past few years building a new animation studio in Port St. Lucie, using millions in incentives from the city and the state. But it defaulted on a series of loans and just days ago said it would lay off about 280 workers and close its Florida facility. CEO John Textor, also the company’s second-largest shareholder, resigned, protesting the decision.
Florida Gov. Rick Scott has ordered his inspector general to investigate the process used to award millions in state incentives that were used to lure Digital Domain to the state.