Digital Domain wants an IPO blockbuster

Posted Dec 13th 2007 3:40PM by Tom Taulli
Filed under: Microsoft (MSFT), Coca-Cola (KO), Sony Corp ADR (SNE), American Express (AXP), Initial Public Offerings

For more than 14 years, Digital Domain has created stunning special effects for Hollywood. The company's wizardry in films like Titanic, Apollo 13, The Fifth Element, I, Robot, Flags of our Fathers, Letters from Iwo Jima, and Transformers has snagged it two Academy Awards. Now, Digital Domain has filed to go public.

A key asset is the company's proprietary technology platform, which is called the "Digital Studio." Besides feature films, the company has leveraged the platform into other areas like TV commercials, interactive visual media and even video games. The company has produced commercials for companies like American Express (NYSE: AXP), Coca-Cola (NYSE: KO), Microsoft (NASDAQ: MSFT), and Sony (NYSE: SNE).

For the first nine months of 2007, Digital Domain's revenues came to $57.5 million, but it saw a net loss of $15.3 million. The company generates a large amount of revenues from contract work, and there is also a segment that licenses the technology.

With the ongoing Hollywood writers' strike though, there could be a fall-off in revenues for next year.

The lead underwriters on the IPO include Thomas Weisel Partners and CIBC World Markets. The proposed ticker is "DTWO."

You can find the prospectus at the SEC website. Also, if you want to find other recent information on IPOs, visit DealProfiles.com.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements.

Tags: Digital Domain, DigitalDomain, IPOs