Hg To Buy Effects Firm The Foundry For £200m

The British visual effects firm which has worked on Hollywood blockbusters such as Gravity and Interstellar will be sold on Thursday in a deal valuing it at £200m.

Sky News has learnt that The Foundry, which offers post-production and other services to film and television studios, is being bought by Hg Capital, a London-based private equity firm.

The deal, which will scupper expectations that The Foundry would be acquired by a big American media or technology group, will be announced in a statement to the London Stock Exchange (Other OTC: LDNXF - news) .

The seller is Carlyle, a major buyout group which took control of the company just over four years ago in a transaction reported to have been worth around £75m.

Sources said on Wednesday that Hg intended to use the purchase as a platform to help expand The Foundry geographically and to diversify its offering across a range of industries.

The company, which is run by chief executive Bill Collis, is headquartered in London and employs nearly 300 people at its base and in Los Angeles.

Mr Collis, who will remain chief executive following Hg's takeover, is known in the effects industry as the designer of the computer programming behind the sequence in The Matrix film where Neo (Shanghai: 600184.SS - news) , played by Keanu Reaves, dodges bullets in slow motion.

People familiar with the deal said that it represented an opportunity to accelerate the growth of a "British technology champion".

The Foundry's visualisation software is now deployed across industries such as automotive and consumer goods, enabling customers to personalise cars and clothing, and people close to the company believe it has huge scope to expand that area of its business.

Its core products include Modo, a 3D creator, and Nuke, which assists visual effects producers.

The sale was handled by Arma Partners, an advisory firm.

Hg could not be reached for comment, while Carlyle declined to comment.