sports Limited (doing business as Luckbox) confirmed Thursday its oversubscribed financing closed at $5.0M CAD ahead of an anticipated TSX Venture Exchange listing (TSXV: LUCK ticker reserved).
The financing, via a brokered and non-brokered sale of subscription receipts, was closed in connection with a proposed go-public business combination with Elephant Hill Capital as capital pool company (CPC) listed on the TSXV, was upsized from the base financing of $2M CAD, despite being conducted during the COVID-enforced lockdown.
The subscription receipts sold in the financing will be automatically exchanged for securities in Elephant Hill upon the closing of the proposed go-public business combination with Elephant Hill, which transaction will be the “qualifying transaction” for Elephant Hill pursuant to the policies of the TSXV.
Upon the closing of the proposed go-public business combination with Elephant Hill, the company will remain listed and all of the security holders of the Esports Limited (including those holding subscription receipts sold in the financing) will be exchanged for securities in Elephant Hill, which will retain its listing on the TSXV and will result in the former being a wholly-owned subsidiary of Elephant Hill.
Among the investors is MLS goalkeeper Luis Robles, who plays for Inter Miami, the franchise co-owned by former Manchester United and Real Madrid star David Beckham.
The brokered portion of the subscription receipt financing was co-led by Gravitas Securities and Beacon Securities, along with a syndicate group consisting of Canaccord Genuity, Echelon Wealth Partners, Haywood Securities, and Eight Capital Corp.
The esports betting industry has been among those apparently resilient to the economic damage inflicted by the Coronavirus pandemic, with the company reporting a 500% increase in betting volume and a 10-fold increase in the number of deposits compared with November 2019.
The Company’s growth plans include rapidly scaling up its global marketing campaign, the acquisition of additional gaming licenses to allow access to additional markets, and the acquisition of an odds provider to be able to offer an unparalleled B2B solution.
In an update to shareholders, the Company’s CEO Quentin Martin said: “The management team and board of directors have been working hard to prepare for the public listing. We have enjoyed positive discussions with the TSXV, completed the Business Plan required for filing, draft financials are complete, with final audit sign-off expected by end of July. Ultimately, we anticipate receiving TSXV listing approval by early October 2020.
“Our management team believes that the esports betting market will continue to grow and that the Company is one of the bookmakers that will be leading the way globally.
“In summary, Luckbox is pleased to have completed a $5.0M financing in connection with its go-public transaction by way of a business combination with Elephant Hill during a challenging period while successfully meeting its Q1 and Q2 roadmap targets which included adding additional languages, user acquisition partners and additional esports titles. We have made tremendous progress in 2020 and look forward to becoming only the second listed dedicated esports betting company on a public exchange.”