Gfinity acquires EpicStream and business update

RNS Number : 5252H

Gfinity PLC

04 December 2020

 

The information contained within this announcement is deemed by the Company to constitute inside information stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement via the Regulatory Information Service, this inside information is now considered to be in the public domain.

04 December 2020

Gfinity plc

("Gfinity" or "the Company")

Gfinity acquires Epicstream, updates on Gfinity Digital Media and Formal Sale Process

Gfinity (AIM: GFIN), a world-leading esports and gaming solutions provider, today announces the acquisition of the trade and assets of Epicstream LLC ("Epicstream"), a leading online news community for fantasy and sci-fi movies, television, video games, collectible cards and comic books (the "Acquisition").

Epicstream delivers daily news and content to its highly engaged fantasy and sci-fi community.  Epicstream.com reaches 600,000 unique visitors each month, whilst its social media platforms, including its prominent Facebook group, has over 6 million likes across 30 pages. The majority of Epicstream's users are based in the US and Canada, with a growing following in the UK, each of which are attractive high value advertising markets.

Epicstream generates revenue through programmatic ads, sponsored content, ecommerce and content creation. Gfinity will also monetise all Epicstream's social channels. The Directors believe that user numbers and revenues can be grown through the deployment of a search engine optimisation strategy, technology toolkit and advertising performance optimisation techniques which have delivered strong results on Gfinity's existing platforms over the past year.

The Acquisition means that Gfinity will assume ownership of the EpicStream.com website, its extensive social media network and their respective historic content. The continued growth of the platform will be supported by its founders joining the Gfinity team. Epicstream will sit within Gfinity Digital Media group ("GDM"), the Company's digital media proposition.

The two founders of Epicstream will each be issued with 10.0 million new ordinary Gfinity shares in consideration for the Acquisition of which two-thirds will be locked-in for a period of one year from issue. The founders will also be entitled to an annual payment of 30% of revenues generated by EpicStream, subject to appropriate caps, in each of the first two years following the Acquisition, payable in annual instalments at the end of each year.

For the year ended 31 December 2019, Epicstream reported unaudited revenue of US$0.4million and net income of US$ 0.3million. As at 31 December 2019, Epicstream had unaudited assets valued at US$0.1million.

Update on GDM

The Acquisition is a further step forward in the Company's strategic focus on owned content and comes as a time when GDM continues to make excellent progress. GDM remains on target to deliver revenue of approximately £2.0 million during the current financial year.

GDM delivered another record month in November, with 14 million monthly users across all sites (12 million in October) and revenues in the month exceeding £275,000 for the first time. In addition, GDM's fourth website, www.racinggames.gg, went live during the month. This new website is focused on virtual motorsport, a key strength of the Company and reflects the board's view of the growing interest and commercial opportunities in this area.

Update on Formal Sales Process (FSP)

The FSP is progressing as planned. The Company continues to engage in conversations and evaluate the best options to accelerate the growth of the business. It will provide further updates as and when appropriate. 

John Clarke, CEO of Gfinity said: "We are delighted to welcome the Epicstream team into the Gfinity family. Francis and Brian have built a highly engaged community around all things fantasy and Sci-Fi. It is a perfect fit for GDM. Together we are going to turbo charge the growth of Epicstream and explore adding new sites into the franchise.

A key pillar of our Company strategy is to focus on products and services that we own. This is where GDM sits. The team has done an amazing job of growing our organic sites and partnering with larger media groups who want to connect with gamers.  The team is also focused on identifying acquisition opportunities. Epicstream is the first of these and we could not be more excited about having the team on board."

Francis Bayog , founder Epicstream said: "Over the past five years, Epicstream has carved a strong niche in the Fantasy & sci-fi space focused on delivering the best content we could share to our diverse audience who share our passion not just for the gaming culture, but also for fantasy & sci-fi movies, TV shows, and books. With Gfinity's talented minds and position in the esports industry combined with Epicstream's passionate community and wide range of subgenres we cover, I believe that we're just barely scratching the surface of what is possible. Our synergy with Gfinity can accomplish what I envisioned Epicstream to be before I launched it - to create something truly EPIC." 

Brian McCormick, joint founder Epicstream, said: " Epicstream has always had the vision of becoming the number one global network for people who share a passion for geek culture. Gfinity shares that passion and we are thrilled to join the Gfinity team. The synergies are clear. With Gfinity's talent, technical expertise, and resources, we will be able to greatly accelerate our plans to make this vision a reality."

ENDS

Enquiries :

Gfinity plc John Clarke, CEO	www.gfinityplc.com Via Teneo
Investor relations	[e-mail]
Teneo  (Media)	Tel: [phone]
Camilla Cunningham	[e-mail]
finnCap Group - Financial Adviser Henrik Persson / Marc Milmo / Kate Bannatyne / Teddy Whiley - finnCap Corporate Finance Chris Malcolm / Steph Frayne - Cavendish Corporate Finance	Tel: [phone]
Canaccord Genuity Limited   (AIM Nominated Adviser & Broker)	Tel: [phone]
Bobbie Hilliam / Georgina McCooke

About Gfinity

Gfinity (AIM: GFIN) is a world leading esports business. Created by gamers for the world's 2.7 billion gamers, Gfinity has a unique understanding of this fast-growing global community.  It uses this expertise both to provide advisory services and to design, develop and deliver unparalleled experiences and winning strategies for game publishers, sports rights holders, commercial partners and media companies.

Gfinity connects its partners with the esports community in authentic and innovative ways. This consists of on‑ and off-line competitions and industry‑leading content production. Relationships include EA SPORTS, Activision Blizzard, F1 Esports Series and the Forza Racing Championship.

Gfinity connects directly with tens of millions of gamers each month through its digital media group, Gfinity Digital Media.  Gfinity Digital Media includes websites such as: Gfinityesports, RealSport101 and StealthOptional and their respective social channels.

All Gfinity services are underpinned by the Company's proprietary technology platform delivering a level playing field for all competitors and supporting scalable multi-format leagues, ladders and knockout competitions.

Other matters  

Rule 26.1

In accordance with Rule 26.1 of the Code, a copy of this announcement will be available on the investor section of the Company's website at www.Gfinityplc.com The content of the website referred to in this announcement is not incorporated into and does not form part of this announcement.

Disclosure requirements of the Code

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

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Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on [phone] if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

 

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