Benzinga | Mar 8, 2021 05:06AM EST

Carlyle Group Acquired Majority Stake in Disguise; Terms Not Disclosed

Global investment firm The Carlyle Group (NASDAQ:CG) today announced it has acquired a majority stake in disguise, a leading provider of extended reality (xR) technology [1] . Terms of the transaction were not disclosed.Headquartered in London, UK, disguise is a leading technology platform which enables creative and technical professionals to imagine, create and deliver spectacular live visual experiences. disguise specialises in combining real-time 3D visualisation-based software with high performance hardware. The company is one of the main providers of xR and virtual production technology to major entertainment providers, film & TV studios, broadcasters, corporates, and fixed installation companies globally.

Disguis e's technology has been instrumental in spearheading immersive content delivery for key projects like the 2020 MTV Video Music Awards and Eurosport's US Open coverage, live performances from artists like Billie Eilish and Katy Perry, in-game concerts like J.Balvin in Fortnite, corporate presentations from Siemens and SAP, and on-set virtual production from notable VFX studios like Framestore and Orca Studios. Since June 2020, over 150 disguise xR stages have been built in more than 35 countries and disguise xR has powered over 200 shows.

The Carlyle Group will support disguise to capitalise on the significant market opportunity for virtual production technology, a trend that has only accelerated during the Covid-19 pandemic. Leveraging Carlyle's well-established track record in growing media technology companies globally through investments such as The Mill and Foundry, Carlyle will seek to expand disguise's customer base through access to Carlyle's large portfolio of corporate customers as well as relationships with key content providers in the media services industry. The investment thesis is also predicated on disguise expanding its software offering and further geographic expansion. Equity for the investment was provided by Carlyle Europe Technology Partners (CETP) IV, a 1.35 billion fund that invests in small and middle market technology-focused opportunities in Europe and the US.

Disguise 's future growth will also be supported by Epic Games, who have taken a minority stake in the business in this transaction. This enhanc es the existing strong partnership between disguise and Epic's Unreal Engine. Production companies and broadcasters are embracing the benefits of virtual production techniques, built on photorealistic real-time graphics engines such as Unreal Engine, and LED infrastructure for immersing presenters and performers in virtual environments.

Fernando Kufer, CEO of disguise, said: 'Sitting at the forefront of innovation in xR technology, we're proud of the journey we have been on with our customers and we're looking forward to further consolidating our position as the global 'platform of platforms' for the creation and delivery of content at any scale and location. We see huge potential for growth based on our leading technology platform and unique service offering. We are delighted to have the full support of The Carlyle Group, a firm with a strong track record of growing technology businesses, as we take disguise into the next chapter of its growth journey.'

Michael Wand, Managing Director and Co-Head of the CETP advisory team, said: 'Given our history of investing in media technology, we are truly excited to partner with disguise - a player at the cutting edge of virtual media production. disguise has a world-class offering and a growing and impressive list of high-profile clients. The virtual production market is forecast to grow substantially, and we believe the company is uniquely placed to benefit from the accelerated demand for LED-based visual experiences and capture further market share. In partnering with the disguise management team, we will look to leverage our significant experience in scaling media technology companies as we support the company to become a global leader.'