TORONTO, Jan. 23,
2024 /CNW/ - OverActive Media Corp. (TSXV: OAM)
("OverActive" or the "Company") today announced that
it has entered into a definitive asset purchase agreement with
Goatch Global, S.L. (operating as "KOI") and a definitive
share purchase agreement with the shareholders of Team Randomk
Esports S.L., (operating as "Movistar Riders"), each dated
January 22, 2024, in respect of its
previously announced acquisition of certain esports assets owned by
KOI and of Movistar Riders (together, the "Acquisitions").
Additionally, Telefónica, a long-time partner of Movistar Riders,
has signed a multi-year partnership extension. Upon completion of
the Acquisitions, the agreement will represent the largest
financial partnership in OverActive's history.
Telefónica has been a main sponsor of Movistar Riders since
2017. The extended partnership agreement between Movistar Riders
and Telefónica includes naming rights, branding presence on
uniforms and merchandise, and content creation and promotion. In
2022, Telefónica FILIALES became a minority owner of the club,
buying 15 percent of Movistar Riders. Upon completion of the
Acquisitions, it will become an OverActive
shareholder.
MAD Lions KOI kicked off the League of Legends EMEA Championship
(LEC) Winter Split on January 13,
with their third match this season reaching 741,000 peak viewers,
making it the most popular regular season LEC match in
history1. Ibai Llanos
co-streamed the matches live, generating more than 6 million views
on Twitch. This follows a January
4th kickoff event celebrating the pending
acquisitions of KOI and Movistar Riders that reached nearly 120,000
concurrent viewers, the largest non-game day audience for
OverActive. The announcement reached an audience of over 5 million
across the Company's social media channels. Ibai will be joining
OverActive as a shareholder and brand ambassador upon the closing
of these transactions.
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1 (4)
Esports Charts 🇺🇦 on X: "741.4K PEAK VIEWERS! 🔥 With this insane
@KarmineCorp vs @MADLionsKOI, #LEC Winter 2024 becomes the most
popular @LEC since Summer 2021! See more stats: 👉
https://t.co/ZRvgCaiTDC https://t.co/Z90FxxvKO6" / X
(twitter.com)
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Acquisition Transaction
Details
Except as otherwise noted below, the definitive agreements are
generally consistent with the terms of the non-binding letter of
intent in respect of the Acquisitions as described in OverActive's
press releases of January 4 and
January 8.
The consideration payable by OverActive for each of the
Acquisitions will consist of up to 30 million common shares of the
Company ("Common Shares"), of which 22.5 million Common
Shares will be issued at closing (the "Initial Consideration
Shares") and up to 7.5 million Common Shares (the "Earn Out
Shares") will be issued based on OAM's EMEA based business
achieving certain adjusted EBITDA targets during the period from
January 1, 2024 to December 31, 2028. Accordingly, the aggregate
consideration payable by OverActive to complete both Acquisitions
is up to 60 million common shares, consisting of 45 million Initial
Consideration Shares and up to 15 million Earn Out Shares. As
previously described, a portion of the Initial Consideration Shares
will be subject to escrow and lock-up arrangements, which will be
as previously disclosed in the case of the Movistar Riders
acquisition. In the case of the KOI acquisition: (i) 7.1
million of the Initial Consideration Shares will be escrowed for
five years, with 20% of the escrowed shares released on each
anniversary of closing; (ii) 12.1 million of the Initial
Consideration Shares will be subject to lock-up for seven years,
with 1/7 of the locked-up shares released on each anniversary of
closing and (iii) 3.3 million of the Initial Consideration Shares
will be issued free of any escrow or lock-up restrictions. None of
the escrow shares or lock-up shares will be subject to surrender or
cancellation except, in the case of the escrow shares, to satisfy
indemnity claims by OAM pursuant to the terms of the KOI asset
purchase agreement.
Assuming the issuance of all of the Earn Out Shares, after
giving effect to the completion of the Acquisitions, the Company
will have approximately 140 million Common Shares outstanding, 30
million of which will be owned by the former owners of Movistar
Riders and 30 million will be owned by Goatch Global, S.L (KOI).
The transaction is an arm's length transaction and will not result
in the creation of a new "Control Person" as defined in the
policies of the TSXV.
Each Acquisition remains subject to a number of conditions,
including the concurrent completion of the other Acquisition, the
receipt of all necessary TSXV, board and third-party approvals
(including, in the case of the KOI Acquisition, the approval of
Riot Games), OverActive entering into new contracts with the KOI
esports team players and coaches and other customary conditions
that are set out in the definitive purchase agreement. For
further details regarding the terms of the Acquisitions please
refer to OverActive's press releases of January 4 and January
8, 2024 and to the copies of the definitive purchase
agreements that will be filed under OverActive's SEDAR profile at
www.sedarplus.com.
Cautionary Note Regarding
Forward-Looking Information
This press release contains statements which constitute
"forward-looking statements" and "forward-looking information"
within the meaning of applicable securities laws (collectively,
"forward-looking statements"), including statements regarding the
plans, intentions, beliefs and current expectations of OverActive
with respect to the Acquisitions. Forward-looking statements are
often identified by the words "may", "would", "could", "should",
"will", "intend", "plan", "anticipate", "believe", "estimate",
"expect" or similar expressions and includes information regarding
(a) the completion of the Acquisitions, (b) the benefits
expected to result from the Acquisitions by the Company, (c) the
future performance of Movistar Riders and KOI, including the
achievement of certain earn-out targets and their continued
expansion and growth, (d) the timing and anticipated receipt of
stock exchange approvals, (e) ability of the parties to enter into
definitive agreements with respect to the Acquisitions and to
satisfy the conditions to the closing of the Acquisitions , and (f)
other statements that are not historical facts.
Investors are cautioned that forward-looking statements are not
based on historical facts but instead OverActive management's
expectations, estimates or projections concerning future results or
events based on the opinions, assumptions and estimates of
management considered reasonable at the date the statements are
made. Although OverActive believes that the expectations reflected
in such forward-looking statements are reasonable, such statements
involve risks and uncertainties, and undue reliance should not be
placed thereon, as unknown or unpredictable factors could have
material adverse effects on future results, performance or
achievements of the OverActive. Among the key factors that could
cause actual results to differ materially from those projected in
the forward-looking statements are the following: the risk that the
parties may not enter into definitive agreements with respect to
the Acquisitions and that the Acquisitions may not be completed on
the terms described herein or at all; the possibility that one or
more of the closing conditions to the Acquisitions may not be
satisfied; risks associated with the integration of the
Acquisitions and the performance of Movistar Riders and KOI
following completion of the Acquisitions; changes in general
economic, business and political conditions, including changes in
the financial markets; changes in applicable laws and regulations
both locally and in foreign jurisdictions; compliance with
extensive government regulation; the risks and uncertainties
associated with foreign markets; and risk factors set out in
OverActive's annual information form for the year ended
December 31, 2021. These
forward-looking statements may be affected by risks and
uncertainties in the business of OverActive and general market
conditions, including COVID-19.
Should one or more of these risks or uncertainties materialize,
or should assumptions underlying the forward-looking statements
prove incorrect, actual results may vary materially from those
described herein as intended, planned, anticipated, believed,
estimated or expected. Although OverActive has attempted to
identify important risks, uncertainties and factors which could
cause actual results to differ materially, there may be others that
cause results not to be as anticipated, estimated or intended and
such changes could be material. OverActive does not intend, and
does not assume any obligation, to update the forward-looking
statements except as otherwise required by applicable law.
ABOUT OVERACTIVE MEDIA
OverActive Media Corp. (TSXV: OAM) is headquartered in
Toronto, Ontario, with operations
in Madrid, Spain and Berlin, Germany. OverActive's mandate is to
build an integrated global company delivering sports, media and
entertainment products for today's generation of fans with a focus
on esports, videogames, content creation and distribution, culture,
and live and online events. OverActive owns team franchises in
professional esports leagues, including (i) the Call of Duty
League, operating as the Toronto Ultra, and (ii) the League of
Legends EMEA Championship, operating as the MAD Lions. OverActive
also leads OAM Live, an events arm that produces both live and
online events.
ABOUT KOI
KOI is the Barcelona
headquartered Esports club founded by Kosmos and Ibai Llanos in December
2021. The club currently has three teams: League of Legends,
which competes in the LVP Superliga; VALORANT, which, after a
season competing in Spain, now
competes in the VALORANT Champions Tour EMEA League; and EA FC.
ABOUT MOVISTAR RIDERS
Movistar Riders is one of the leading eSports clubs in
Spain. Its professional players
represent the Movistar Riders brand in multiple national and
international tournaments, competing in the most popular games such
as League of Legends, CS2, or VALORANT; in addition to having the
Atlético de Madrid - Movistar team
for EA FC.
The club is headquartered at the Movistar eSports Center, in
Matadero Madrid, a high-performance center where both players and
coaching staff have the most advanced means to develop their
activity at the highest level.
For more information, visit the club's official website:
https://www.movistarriders.gg/
Neither the TSXV nor its Regulation Services Provider (as
that term is defined in the policies of the TSXV) accepts
responsibility for the adequacy or accuracy of this
release.
SOURCE OverActive Media