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Rhythm & Hues Studio, the bankrupt visual-effects house behind the Oscar-winning effects in Life of Pi, has found an early potential buyer in a South Korean company named JS Communications Co. The media company signed a letter of intent and was picked as the stalking horse bidder.
Deadline reported that JS Managing Partner David Shim wrote in the letter of intent that they hope to buy the company by the end of this month. “We are prepared to proceed with our due diligence and negotiate a Definitive Agreement as soon as possible,” he wrote Thursday. They stressed that they will only go through if R&H gives them stalking horse bidder status in bankruptcy court, a term which according to The Wrap has already been satisfied.
The stalking horse bidder represents the absolute lowest bid that a company will go for at auction and encourages competition within the bidding pool. Other bidders have until March 12 to put in their own bids for the company.
R&H says that it needs to sold by the middle of the month or it will run out of money. A judge permitted the company to accept $20 million in loans from Universal, Fox and Legendary Pictures to keep it afloat while they complete films-in-progress for those studios. THR reported that the company is also working on films for Warner Bros. All the movies to which R&H is currently committed are slated to be out by this summer.
As previously reported, the VFX industry in California has been floundering, with studios seeking overseas help. R&H is not the first to file bankruptcy; Digital Domain went under last year and is now owned by companies in China and India.