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Now browsing: Hometown News > News > St. Lucie County

Animation company has massive layoff
Rating: 3.48 / 5 (23 votes)  
Posted: 2012 Sep 14 - 01:10

Sketchy circumstances close animation studio

By Dawn Krebs

dkrebs@hometownnewsol.com

ST. LUCIE COUNTY - In a move that sent shock waves through the St. Lucie County community, Digital Domain Media Group closed its doors on Sept. 7, laying off almost 300 employees after a week of stock volatility and debt announcements.

The move was announced that morning by company officials who called it a "strategic realignment" that will enable it to focus its resources on its core business, Digital Domain Productions.

Only 20 employees in the Port St. Lucie location, which opened its doors less than a year ago as a special effects and animation studio, will remain.

John Textor, who was the CEO and chairman of the board of directors since the company first came to the area, resigned at the close of business Sept. 6, stating he disagreed with the company's decision to close the studio.

"The people of Florida welcomed us with open arms and we certainly owed them greater consideration," he wrote in his letter of resignation.

"We were able to hire and train local residents and have them mentored by the very best of our industry. I am deeply sadden and heartbroken by this decision."

The board of directors appointed Ed Ulbrich, the company's chief creative officer, to the CEO position, while Michael Katzenstein will be the interim chief operating officer at the Port St. Lucie location. Neither man could be reached for comment.

The company went on to state the move was to "reduce its overhead and restructure long-term debt."

A recent filing to the Securities and Exchange Commission revealed the company is in default of senior notes, or loans, which increased the amount owed from $35 to $51 million. It wasn't lack of payment of the notes that caused the default however; instead, it was not having enough money on hand to satisfy the terms of the loan.

The company's studios in California and Canada, as well as the education institute recently established in West Palm Beach, will not be affected.

But while the company works through its next move, Mr. Textor focused his comments on the reality his employees now face.

"I believe this to be the wrong path," he wrote. "I think the outcome was not only unwise, but also without compassion."

He wrote he intends to stay an active shareholder of the company, as well as a believer in Florida, and will work to independently consider other strategic alternatives for the company, the studio and the residents of Port St. Lucie.

Meanwhile, city officals held a press conference on Friday afternoon to address the issue.

The city had pledged millions to help bring the company to the area. Part of the money came from a grant that was funded by developers.

The closing of the facility caught city officials by surprise.

"This was very big for the city of Port St. Lucie," said Mayor JoAnn Faiella.

"We had no representation that I know of that any of this was going on," said Shannon Martin, city councilwoman.

City Councilwoman Michelle Berger added, "There were so many people involved in vetting this process, this company."

Greg Oravec, Port St. Lucie city manager, said the city's responsibility is to the taxpayers.




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