Technicolor Begins to Shut Down Operations ‘Due to Inability to Find New Investors’

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After an effortful weekend to secure last-minute deals to preserve the company and its brands, Technicolor Group’s CEO, Caroline Parot, communicated with employees on Monday. In her memo, she explained that despite extensive attempts, no investors were found for the entire group. Consequently, Technicolor Group has sought a ‘recovery procedure’ in the French Court of Justice to create an opportunity to discover potential solutions.

Technicolor consists of several prominent visual effects companies: MPC (known as “Mufasa” or “The Lion King”), commercial VFX brand The Mill, Mikros Animation, and Technicolor Games. If MPC and Technicolor were to close down their operations entirely, it would impact a significant number of visual effects professionals not just in the U.S., UK, Canada, but also India. This sudden change in business has created concern and sadness among members of the VFX industry.

Parot’s memo outlines that a suitable system for maintaining order, protection, and future progress is being established in each country, so as to keep the business running smoothly whenever feasible.

Technicolor has initiated the closure of its U.S. operations. As of last Friday, they started informing affected customers and staff members, issuing WARN notices to their American workforce in accordance with legal requirements for big corporations planning to close down or carry out extensive layoffs.

As a movie critic, I’m excited to share that I’ve learned about an upcoming collaboration among the creative leadership and a significant portion of the staff from The Mill U.S., previously under Technicolor. They are teaming up with Dream Machine FX to establish Arc Creative, a new venture in the visual effects industry. According to reports, they are diligently working on launching this new entity amidst the intricate challenges posed by Technicolor’s Chapter 7 bankruptcy proceedings.

There are uncertainties regarding how film studios will complete their ongoing projects that are being handled by MPC (Visual Effects Company), such as Disney’s live-action version of “Lilo & Stitch” and Paramount’s “Mission: Impossible – The Final Reckoning,” along with the works of Mikros, including the upcoming sequel to “Teenage Mutant Ninja Turtles” for Paramount and Nickelodeon.

Over the past couple of years, I’ve been part of Technicolor as it navigated through a series of restructurings and management changes. As stated in our recent memo, the group has faced a multitude of challenges stemming from various sources. These challenges include the tough operational circumstances following the COVID-19 recovery, a costly and intricate separation process from our former group, and the writers’ strike which led to a decrease in customer orders, resulting in significant cash flow strains.

In 2021, Streamland Media acquired Technicolor Post for $36.5 million. This merger combined Technicolor’s operations with those of Streamland, encompassing Picture Shop among others. The following year, Technicolor rebranded MPC and its existing brands as Technicolor Creative Services. On the other hand, the company’s connected home and supply chain services were given a new identity under the brand name Vantiva.

The text of Parot’s memo to employees follows.

Dear Team,

In my recent reflections as a movie critic, I must admit that the cinematic landscape has been challenging for us. Over the past few months, our organization has been grappling with a multitude of issues stemming from internal and external factors. The aftermath of the pandemic has left us in a tough operational condition, struggling to regain our footing during recovery.

Additionally, we’ve embarked on a costly and intricate separation process from our previous conglomerate, which has been taxing on our resources. To make matters worse, the ongoing writers’ strike has caused a slowdown in customer orders, leading to significant strain on our cash flow. It’s been a tough ride, but we remain steadfast in our pursuit of excellence and growth.

Today, due to our unsuccessful attempts at securing new investors for the entire group, we’ve been compelled to confront the truth. In an effort to find potential solutions, Technicolor Group has sought protection under a “recovery procedure” in the French Court of Justice.

In every nation, they are establishing the suitable system for organized protection and progress, with the aim of keeping business operations running smoothly whenever feasible.

Or:

For each country, a system that guarantees safety and future development is being set up right now, so that businesses can continue to function as normally as possible when it’s safe to do so.

We didn’t arrive at this choice quickly or carelessly; we will diligently investigate every avenue to safeguard our heritage and ensure the continued success of our teams, offering opportunities for each endeavor to be carried on with potential new financial backers.

Beyond simply being a corporation, Technicolor represents a vibrant collective of gifted, enthusiastic, and imaginative minds. Together, we’ve breathed life into some of the most memorable visual tales. Our collaborations showcase our commitment, skill, and unique identity – a reflection of who Technicolor truly is.

Moving ahead, our main focus is to assist you during this transition phase. Due to the intricacies of labor laws and rules in the various countries where we work, this procedure will be handled on a country-by-country basis. This approach guarantees adherence to local guidelines and ensures that every one of you receives the necessary assistance throughout the process.

As a fellow movie enthusiast, I understand these challenging times we’re going through. Rest assured, I am here to help and assist you in every possible way.

In every one of your respective nations, an individual email tailored to your specific circumstances will be sent to you when appropriate.

For each of your countries, you’ll get a personalized email about your unique situation at the right moment.

With deepest appreciation and respect,

Caroline Parot

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2025-02-25 05:16