LOS ANGELES, March 29, 2013 /PRNewswire/ -- Academy Award®-winning visual effects and animation studio Rhythm & Hues was acquired out of bankruptcy today by a wholly-owned affiliate of Los Angeles-based Prana Studios, Inc. At a hearing held today in U.S. Bankruptcy Court in Los Angeles, Judge Neil Bason approved Prana Studios affiliate, 34x118 Holdings Inc., as the winning bidder after a two-day auction. Prana Studios, Inc. is a U.S. animation and visual effects studio with offices in Los Angeles and Mumbai, India. "Our partnership will allow R&H to continue the business of creating world-class digital imagery," said Jeffrey A. Okun, Senior Vice-President, VFX, Prana Studios. "While remaining a stand-alone company focusing on cutting-edge visual effects and innovative technology, R&H will be complimented by Prana's world-class long-form animation. Our complimentary talents and relationships will create a new, best-in-class one-stop boutique provider of digital imagery to clients globally. With the additional support of our strong investor group, we are confident R&H will continue to be the innovative quality leader in our field that they've been for 30 years. We are thankful to Universal and Fox for their overwhelming support." The company's assets were acquired from the court by 34x118 Holdings Inc., a Prana Studios affiliate. 34x118 Holdings Inc. is the new operating company. Allan Soong of Deliotte CRG will serve as Chief Restructuring Officer of the new operating company, and will work with Lee Berger as President, Erika Burton as Co-President, and Gautham Krishnamurthy as CTO to restructure the operations while maintaining the creative expertise which comprises the heart and soul of the R&H brand. "This is a positive outcome to a difficult situation," said Lee Berger, "and we are thrilled to be able to put this process behind us. We are grateful for Prana's support as well as the support of their investor group, and are excited to begin the next chapter of R&H's history." Anand Mahindra, Chairman, Mahindra Group said, "We are delighted to have been early-stage investors in Prana Studios. This bold move will make them the animation / VFX leaders with global delivery capability and will substantially increase the scale and complexity of their work." Founder of Sherpalo Ventures and Google Board member Ram Shriram said, "I am excited for Prana - the best at full service digital animation, and now digital VFX. This new arrangement allows for a single stop, stable long term solution for all the digital creative needs of the studios."