EBET Stock Price: Why It Fell Today

By Amit Chowdhry ● Oct 1, 2021
  • The stock price of Esports Technologies Inc (NASDAQ: EBET) fell by over 6% during intraday trading today. This is why it happened.

The stock price of Esports Technologies Inc (NASDAQ: EBET) – a leading global provider of advanced esports wagering products and technology – fell by over 6% during intraday trading today. Investors are responding negatively to Esports Technologies announcing today the execution of a definitive agreement for the acquisition of Aspire Global’s (STO: ASPIRE) B2C business in a $75.9 million transaction, including $58.3 million in cash, $11.7 million in a promissory note and approximately $5.9 million worth of common stock. And the closing of the acquisition is subject to Esports Technologies’ receipt of financing, as well as other closing requirements. The deal is expected to close by November 30, 2021.

Under the terms of the deal, Esports Technologies will buy Aspire’s portfolio of B2C proprietary online casino and sportsbook brands, including Karamba, Hopa, Griffon Casino, BetTarget, Dansk777, and GenerationVIP. Esports Technologies plans to utilize the multiple-brand acquisition to cross-sell esports wagering opportunities to increase its esports revenue, player bet transactions, and customers.

In the most recent one-year period ending June 2021, Aspire Global’s B2C revenue was $73.9 million and its EBITDA was $8.2 million. During the same period, the B2C business recorded wagering of $1.8 billion and more than 1.3 billion bets.

Upon completion of the acquisition, Aspire and Esports Technologies will be entering into an agreement where Aspire will provide 4 years of managed services for the acquired brands, ensuring operational continuity while allowing Esports Technologies to scale its operations in key markets.

Esports Technologies had entered into binding agreements with certain investors for a private placement of $36.2 million consisting of convertible preferred stock at an initial conversion of $28 per share, subject to future adjustments and warrants to purchase common stock. And the conversion of the preferred stock and exercise of the warrants is subject to the receipt of shareholder approval.

KEY QUOTES:

“The acquisition of Aspire’s B2C business will be a transformative opportunity to accelerate growth by offering esports wagering to 1.25 million new deposited customers. Our company is in a strong position to benefit from the heightened popularity and growing interest in esports.”

— Aaron Speach, CEO, Esports Technologies

“Esports Technologies is a strong company with high growth ambitions and is a perfect match for our B2C brands. With Aspire Global’s B2C brands, Esports Technologies gains leading, well-established brands, an excellent base for further growth and a very talented team that contributed to the B2C’s growth. We are confident that Esports Technologies will take our B2C brands to the next level, and we welcome Karamba and the other B2C brands as our new partners.”

— Tsachi Maimon, CEO of Aspire Global

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.