NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, DIRECTLY OR INDIRECTLY, IN
PRESS RELEASE
INSIDE INFORMATION:
THE TRANSACTION IN BRIEF
- The Transaction is in line with EG7's previously communicated strategy to conduct complementary acquisitions to establish a more favorable industry position.
- The Transaction is expected to result in a strengthened business model with increased revenues and profit.
-
Following completion of the Transaction, EG7's pro forma financials* for the period Jan-
Dec 2020 , including the recent acquisitions ofDaybreak Game Company , Big Blue Bubble and Piranha Games and the Transaction, will amount toSEK 2,061 million revenue andSEK 652 million EBITDA. -
The consideration for 100 percent of the shares in Innova, calculated on a cash- and debt- free basis, amounts to approximately
EUR 109.8 million , equivalent to approximatelySEK 1,104 million [1], to be paid in full at closing. -
The entire Purchase Price has been agreed to be paid with a maximum of 9,726,054 EG7 shares (the "Consideration Shares"), based on the Volume Weighted Average Price for the EG7 share ("VWAP") on Nasdaq First North Growth Market for the 10 consecutive trading days preceding this announcement (excluding today's trading) equal to
SEK 113.57 . - The Transaction does not include any earn-out consideration.
- 75 percent of the Consideration Shares will be subject to a 24-month lock-up from the date of completion of the Transaction. The remaining 25 percent of the Consideration Shares will be subject to a 6-month lock-up from the date of completion of the Transaction.
- Completion of the Transaction is expected to take place at the end of the first calendar quarter of 2021.
BACKGROUND AND RATIONALE
Innova is a well known video game publisher with decades of solid experience mainly within the free-to-play Massively Multiplayer Online Role-Playing Game (MMORPG) genre. Titles that Innova have published include Lineage 2, Ragnarök Online and Point Blank.
Since Innova's founding in 2006, the company has focused on free-to-play MMORPG titles and quickly became a partner of the most prominent video game developer in
The acquisition rationale for EG7 is Innova's extensive and diversified portfolio of well-known titles with long-term cash-flows, its established presence in
Within the
PURCHASE PRICE AND LOCK-UP PERIOD
The Purchase Price of
The Transaction does not include any earn-out consideration.
75 percent of the Consideration Shares will be subject to a 24-month lock-up from the date of completion of the Transaction. The remaining 25 percent of the Consideration Shares will be subject to a 6-month lock-up from the date of completion of the Transaction.
ISSUE OF CONSIDERATION SHARES
The board of directors of EG7 will resolve to issue the Consideration Shares at completion of the Transaction pursuant to an authorization granted by a general meeting or subject to subsequent approval from a general meeting.
When issued, the Consideration Shares will represent a maximum of 11.26 percent of the total number of shares and votes in EG7 on a fully diluted basis. By issuing the Consideration Shares, the number of shares and votes will increase by a maximum of 9,726,054, from 76,630,359 to a maximum of 86,356,413. The share capital will increase by approximately
The Consideration Shares will be issued at a price of
CLOSING OF THE TRANSACTION
Completion of the Transaction is expected to take place at the end of the first calendar quarter 2021.
ADVISORS
FOR FURTHER INFORMATION, PLEASE CONTACT:
Phone: +46 70 477 06 34
robin@enadglobal7.com
ABOUT EG7
EG7 is a group of companies within the gaming industry that develops, markets, publishes and distributes PC, console and mobile games to the global gaming market. The company employs 400+ game developers and develops its own original IP:s, as well as act as consultants to other publishers around the world through its game development divisions Daybreak Games,
Nasdaq First North Growth Market Ticker Symbol: EG7
Certified Adviser:
*: Note that the pro forma figures have not been audited by the company's auditor and should not be considered as an indication of the Group's performance for the coming 12 months. The acquisition of Piranha Games has not been completed as per the publishing date of this press release.
The information in this press release constitutes inside information that
IMPORTANT INFORMATION
The release, announcement or distribution of this press release may, in certain jurisdictions, be subject to restrictions. The recipients of this press release in jurisdictions where this press release has been published or distributed shall inform themselves of and follow such restrictions. The recipient of this press release is responsible for using this press release, and the information contained herein, in accordance with applicable rules in each jurisdiction. This press release does not constitute an offer, or a solicitation of any offer, to buy or subscribe for any securities in EG7 in any jurisdiction, neither from EG7 nor from someone else.
Forward-looking statements
This press release contains forward-looking statements that reflect the Company's intentions, beliefs, or current expectations about the completion of the Transaction and the timing for its completion, the satisfaction of closing conditions and targets for the Company's and the Group's future results of operations, financial condition, liquidity, performance, prospects, anticipated growth, strategies and opportunities and the markets in which the Company and the Group operates. Forward-looking statements are statements that are not historical facts and may be identified by words such as "believe", "expect", "anticipate", "intend", "may", "plan", "estimate", "will", "should", "could", "aim" or "might", or, in each case, their negative, or similar expressions. The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurances that they will materialise or prove to be correct. Because these statements are based on assumptions or estimates and are subject to risks and uncertainties, the actual results or outcome could differ materially from those set out in the forward-looking statements as a result of many factors. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this release by such forward-looking statements. The Company does not guarantee that the assumptions underlying the forward-looking statements in this press release are free from errors and readers of this press release should not place undue reliance on the forward-looking statements in this press release. The information, opinions and forward-looking statements that are expressly or implicitly contained herein speak only as of its date and are subject to change without notice. Neither the Company nor anyone else undertake to review, update, confirm or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this press release, unless it is not required by law or Nasdaq First North Growth Market rule book for issuers.
[1]
All conversions from EUR to SEK in this press release are made with the exchange rate EUR/
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