Spackman to sell Frame Pictures to High Vision for KRW450M

Korean picked vegetables, including kimchiKorean picked vegetables, including kimchi

Spackman Entertainment Group has entered a deal to sell camera-equipment leasing player Frame Pictures to High Vision for 450 million South Korean won, or around US$382,164, the South Korean drama player said in a filing to SGX Thursday.

“Against the backdrop of uncertainty of the entertainment sector brought about by the Covid19 pandemic, particularly in relation to the theatrical film industry, the board is of the view that the proposed disposal is in the best interests of the company and shareholders,” Spackman said in the statement, noting the cash consideration will enhance liquidity.

Frame Pictures has been posting losses  since fiscal 2019 due to a drop in the number of leasing contracts for its equipment, due to Covid-related reasons and as the assets are depreciating from being worn-out and as newer camera models are rendering its assets obsolete, Spackman said.

Spackman added that the capital expenditure needed to reinvigorate Frame Pictures and purchase newer camera models is unsustainable long-term due to the group’s financial position, with the around US$6.9 million needed over the next five years too costly.

The camera equipment leasing business also isn’t aligned with the group’s overall strategy, which has shifted to focus on producing and financing Korean dramas and U.S. films, Spackman said.

Around 50 percent of the estimated net proceeds of US$354,404 will be used for investment projects and the remainder for working capital, Spackman said.

Hanul LLC Crowe Horwath, commissioned as independent valuer, determined Frame Pictures was valued at 412.02 million won, the filing said.

South Korea-based High Vision, which has Kim So-yun as its ultimate beneficial owner and sole director, is involved in the production and distribution of movies, videos and broadcast programs and other entertainment management services, the filing said.