Targets growth potential from new products

EEG completes common stock and warrants public offering, raises $13.6M in proceeds

Grant Johnson, CEO of Esports Entertainment Group. 
Reading time 1:51 min

Esports Entertainment Group has successfully completed its public offering of common stock and warrants, the business announced on Wednesday. The esports and online gambling company has now raised proceeds of $13.6 million net of underwriting discounts, commissions and estimated offering expenses. New funds will target growth potential produced by the company’s newest esports products, as well as its European-based iGaming and online sports betting businesses.

EEG sold 15,00,000 shares of common stock and warrants to purchase 15,000,000 shares of common stock for a combined effective offering price of $1.00, with each common share accompanied by a warrant, the business explains.

The warrants are immediately exercisable at a price of $1.00 per share of common stock and expire five years from the date of issuance, according to a press release. The shares of common stock and the accompanying common warrants were issued separately and are immediately separable.

The offering is being made pursuant to an effective shelf registration statement on Form S-3, previously filed with the U.S. Securities and Exchange Commission (SEC) and which became effective on February 5, 2021. Maxim Group LLC and Joseph Gunnar & Co., LLC acted as book-running managers for the offering.

“The proceeds from this important offering allow us to build our working capital reserves and enable the Company to repay a portion of its outstanding debt,” said Grant Johnson, CEO of Esports Entertainment Group. 

According to the executive, collectively, this will provide the company with “a far firmer” foundation, which will allow EEG to take advantage of the growth potential provided by the company’s newest esports products, as well as its European-based iGaming and online sports betting businesses.

“In particular, we remain extremely bullish about the growing interest in our OMEGA solution and believe the debut of our LANDuel platform later this month will have a material impact on our financial performance in the coming quarters,” Johnson added.

The company had previously described a “considerable interest” from operators in its OMEGA product in a financial report shared last month. The esports gaming turnkey solution for businesses and entertainment venues debuted in FY22 Q2.

EEG has shown confidence it will soon become “a more important contributor” to its top-line results, and in late February, the company announced it would be installing OMEGA at a series of locations in the Netherlands through a distribution deal with Dutch gaming and esports startup GAMMAX.

Meanwhile, LANDuel -a peer-to-peer skill-based wagering platform- will be debuting at Hard Rock in Atlantic City through the first sanctioned esports skill-based wagering event in the United States. Initially slated for January, the tournament has been moved to March 18-20, and is expected to expose EEG “to a significant and untapped market” across many US jurisdictions.

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