I think that is a plausible explanation.
I'm not a shareholder, but if I were, I don't think I would like it. REDG, doesn't have the cash flow to pay the expenses of a film company. An expensive NY adress, REDG is in Florida, Hollywood is in California. I'm not sure how this works.
I would especially hate to see that they took on convertible debt to pay cash for it, unless it is a "cash cow" z(but then it doesn't make sense to sell it to REDG).