Rainmaker sells to Deluxe

Post and visual effects divisions and London studio sold off as Vancouver company narrows its focus on animation

Rainmaker is getting out of the post-production and effects business, and has sold both divisions to Deluxe so it can focus on producing its own animation.

Deluxe — the post-production giant with offices in L.A., Toronto, Rome, Florence, Madrid and other locations — revealed Thursday it is buying Rainmaker Visual Effects and Rainmaker Post in Vancouver, as well as the company’s visual effects studio in London.

The deal, the financial details of which have not been revealed, follow talks over the past four months.

‘Deluxe has been looking to move into Vancouver for quite some time,’ says Rainmaker CEO Warren Franklin, speaking to Playback Daily. ‘Recently they came back and expressed interest in working out a deal. They’ve become very interested in the visual effects business.’

Franklin will remain atop Rainmaker Entertainment, which runs Rainmaker Animation, an outfit that until earlier this year was known as Mainframe Animation.

Rainmaker bought Mainframe Entertainment in 2006, a move that, at the time, positioned Rainmaker as the largest animation and visual effects house in the country.

‘We were building out the company and trying to grow all its aspects,’ he says. But after the Mainframe purchase, ‘it became clear we wanted to focus our efforts on producing our own content.’

The company’s toonmakers are partway through production of the feature Escape From Planet Earth, due in theaters through The Weinstein Company in 2009, and are developing a feature trilogy based on ReBoot, a CG series from the 1990s that the company inherited from Mainframe. The ReBoot project is expected to begin production in three to four months, says Franklin.

Rainmaker is smitten with the prospects of stereoscopic animation, he says, citing the success of Beowulf and the re-release of The Nightmare Before Christmas.

‘We feel that’s going to be a very strong market for us. That’s really where we’re looking to go,’ says Franklin.

The company is ‘not anticipating any layoffs’ in Canada or the U.K., he says. Paul Gertz will remain as EVP of animation at Rainmaker, while lab and post-production chief Barry Chambers will continue in his current role through the close date. After that, he will consult with Rainmaker Entertainment. Former Mainframe boss Rick Mischel remains as an executive producer in animation.

Cyril Drabinsky, CEO and president of Deluxe, said in a statement that entering the Vancouver market is a ‘natural extension’ for the company, allowing it to more easily serve productions at work in B.C.

Rainmaker Entertainment is owned by the Rainmaker Income Fund, shares of which were up 4% to $2.81 by mid-day. The deal is subject to approval by Canadian Heritage and is expected to close by Dec. 31, the end of Rainmaker’s fiscal year.