ESE Signs Letter of Intent to Acquire Leading Esports Company, Digital Motorsports
VANCOUVER, British Columbia, May 13, 2021 (GLOBE NEWSWIRE) — ESE Entertainment Inc. (“we”, “ESE”, or the “Company”) (TSXV: ESE) (OTCQB: ENTEF) is pleased to announce that it has signed a Letter of Intent (“LOI”) to acquire (the “Acquisition”) Auto Simulation Ltd T/A Digital Motorsports (“Digital Motorsports”), an Irish company that provides infrastructure, technology, and support for esports across the globe – particularly in the simulation racing sector – working with some of the world’s most recognized brands.
Under the terms of the LOI, it is contemplated that ESE will acquire 100% of the issued and outstanding securities in the capital of Digital Motorsports. The purchase price, which will be confirmed following completion of further due diligence, will be paid with a portion in cash and the balance in common shares of ESE at a deemed price of $1.48 per share, such shares to be released over three years from issuance. The LOI provides that the founder and CEO of Digital Motorsports, as well as its staff, will continue to operate Digital Motorsports’ business following closing.
Digital Motorsports is an award-winning organization and one of the leading simulation racing companies worldwide, with demonstrated profitability and double-digit year-over-year revenue growth. Included in the Acquisition would be Digital Motorsports’ portfolio of intellectual property related to racing simulator solutions, components, and cloud-based racing services. Additionally, Digital Motorsports is currently developing both products and technology to reduce the complexity and barriers to entry in sim racing. Digital Motorsports has key vendor distribution rights and partnerships in the industry. It has signed contracts with the FIA-accredited Motorsport Ireland to host all of the national esports events, contributing to the possibility of representing Ireland at official FIA Digital Motorsport Games and the Virtual Olympics.
In 2019 Digital Motorsports represented Ireland at the inaugural FIA Motorsport Games in Rome, created a digital fan zone at the European Driftmasters Finals and launched their Virtual Race Academy at Mondello Race Circuit. They have worked with world champions across multiple disciplines from F1, WEC, WRC, Drifting, and more. Digital Motorsports are a customer-centric business offering a mix of professional products, turnkey solutions, and a world class esport racing league.
The proposed Acquisition is intended to build on ESE’s already strong position in the sim racing market, and bring it one step closer to becoming one of the largest gaming and esports infrastructure companies in the world.
Konrad Wasiela, CEO of ESE, commented, “We are excited to announce the anticipated expansion of our business with the proposed acquisition of Digital Motorsports. Our shared vision of becoming the number one global brand for esports in the motorsports industry was paramount in coming together to sign the LOI. We are excited to work closely with Digital Motorsports to build on their existing business, focusing on increasing revenue and profit margins. Niall and his team at Digital Motorsports have been able to prove a profitable business model, with contracts with tier-1 customers across the globe, and they are just getting started. The digital motorsport sector continues to grow around the world, and we are thrilled to have the opportunity to become a key part of that growth.”
Niall Maher, CEO of Digital Motorsports, commented, “We are excited to have agreed on this letter of intent to become part of the ESE family. We believe in Konrad and his team’s ambition to grow ESE into a billion-dollar plus company. The visions of the two companies are aligned to take the top spot on the podium. We are really looking forward to leveraging the ESE infrastructure, technology and expertise to create something truly special. This will only benefit our customers and the wider sim racing community.”
The Acquisition remains subject to, among other things, satisfactory completion of ESE’s due diligence, the parties entering into a definitive agreement and TSX Venture Exchange approval.
ESE is a Europe based entertainment and technology company focused on gaming, particularly on esports. ESE consists of multiple assets and world-class operators in the gaming and esports industries. Capabilities include physical infrastructure, broadcasting, global distribution for gaming and esports-related content, advertising, sponsorship support, and a growing esports team franchise, K1CK Esports. ESE is focused on bridging Europe, Asia and North America. | www.ese.gg
This news release contains certain statements that may constitute forward-looking information under applicable securities laws. All statements, other than those of historical fact, which address activities, events, outcomes, results, developments, performance or achievements that ESE anticipates or expects may or will occur in the future (in whole or in part) should be considered forward-looking information. Such information may involve, but is not limited to, statements with respect to: (i) the terms of the definitive agreement with Digital Motorsports; (ii) the likelihood of and timeline for completing the Acquisition; (iii) the expected benefits of the Acquisition for ESE; (iv) the impact of the Acquisition on ESE’s position within the digital motorsports market; (v) the expected growth of the digital motorsports market; and (vi) future profitability of Digital Motorsports. Often, but not always, forward-looking information can be identified by the use of words such as “plans”, “expects”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, or “believes” or variations (including negative variations) of such words and phrases, or statements formed in the future tense or indicating that certain actions, events or results “may”, “could”, “would”, “might” or “will” (or other variations of the forgoing) be taken, occur, be achieved, or come to pass. Forward-looking information is based on currently available competitive, financial and economic data and operating plans, strategies or beliefs as of the date of this news release, but involve known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, performance or achievements of ESE to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors may be based on information currently available to ESE, including information obtained from third-party industry analysts and other third-party sources, and are based on management’s current expectations or beliefs regarding future growth, results of operations, future capital (including the amount, nature and sources of funding thereof) and expenditures. Any and all forward-looking information contained in this press release is expressly qualified by this cautionary statement. Trading in the securities of ESE should be considered highly speculative.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE ESE Entertainment Inc.
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