Formerly known as Millennial Esports Corp., Torque Esports Corp. (CVE: GAME) revealed it had entered a letter of intent dated Oct. 21, 2019, to acquire esports event platform UMG Media (TSX Venture: ESPT). The transaction will see the esports racing company Torque and UMG combine to create a single entity which has operations in simulation racing, first-person shooter, and sports titles.
UMG Media acquisition
Dave Antony, CEO of UMG said this about the acquisition: “UMG is thrilled to join forces with Torque to build a broader esports company. We are confident the combined expertise of the groups will ensure future success.”
UMG Media’s broadcast capabilities will help improve content creation for events currently produced by Torque, including the World’s Fastest Gamer competition, which features gamers competing in simulation racing titles. In addition, UMG is known for its online esports tournament platform and experience with hosting gaming events, which Torque will utilize for its sim racing content. Lifestyle gaming apparel company Meta Threads is also owned by the company.
“We have been in contact with the UMG team for over a year now and have followed their journey with interest. We have been impressed both with the size of their business and the level of engagement with their gaming audience,” said Darren Cox, President and CEO of Torque Esports, in a statement. “Those two metrics, audience size, and engagement, will define the winners in the gaming industry over the next few years. UMG also has other, less obvious, benefits to us.”
“Combining their traffic with our Stream Hatchet data business will give us a lead in audience insight for brands, while UMG’s content delivery will also combine well with YouTube channel Let’s Go Racing, our recently announced acquisition.”
Torque Esports Letter of Intent
Canadian gaming company Torque Esports recently restructured after its rebranding. The company operates brands like tournament provider IDEAS+CARS, mobile game studio Eden Games, racing simulator hardware provider Allinsports, and live stream intelligence platform Stream Hatchet.
The transaction is subject to the approval of at least 66 2/3% of the votes cast by holders of UMG Shares at a special meeting in December of 2019. It is also subject to Torque completing the acquisition of 51% of Allinsports SRL, receipt of certain regulatory, court and stock exchange approvals and certain other closing conditions customary in transactions of this nature.
Following the completion of the transaction, Torque will have approximately 9 million shares outstanding. The Letter of Intent provides for the parties to complete their due diligence and execute a definite arrangement agreement before Oct. 28, 2019.
Prior to the completion of the transaction, UMG also intends to complete a non-brokered private placement of $1.2 million of UMG Shares for $0.12 per share, subject to regulatory approval.