3 Interactive announced that it has closed the previously announced transaction to acquire a controlling interest in an Indian entity that owns an active Indian poker brand (Indian Poker Operation).
The completion of the transaction marks the latest step in the company’s continued efforts to capitalize on the international growth of poker and create long-term value for its shareholders.
"We are thrilled to have completed this Transaction. With the historical and projected growth of poker in India the Company has strategically positioned itself within a key market in order to deliver strong performance and return on shareholder value. This acquisition is a significant step forward in executing on our strategy to identify and pursue growth in strategic markets. The Indian Poker Operation creates an immediate additional stream of recurring revenues from a loyal customer base in an established international market for the poker business," said Chris Neville, Chief Executive Officer of the Company.
Indian Poker Operation
As of the date of this press release, the Indian Poker Operation is part of one of the largest poker networks in the world with over a million registrations and 100,000 active users. The Indian Poker Operation operates on a mobile poker platform with features such as unparalleled welcome bonuses and VIP programs.
The Transaction, which was completed pursuant to the terms of the business combination agreement dated August 10, 202 entered into by and among the Company and an arm’s length, private British Columbia corporation, was completed by way of a three-cornered amalgamation under the Business Corporations Act, among the Company, B.C. Corp., and 1260039 B.C. Ltd. (“Subco”), a wholly owned subsidiary of the Company incorporated for the purposes of completing the Amalgamation. Under the Amalgamation, B.C. Corp. and Subco amalgamated to combine their corporate existence, with the entity resulting from the amalgamation continuing as a wholly-owned subsidiary of the Company under the name “i3 India Holdings Corp.” (the “B.C. India Holding Subsidiary”).
Pursuant to the Transaction, the Company acquired all the issued and outstanding shares of B.C. Corp. (the “Target Shares”), and in exchange, issued, to the former shareholders of B.C. Corp., one (1) common share in the capital of the Company (each, a “Common Share”) for each Target Share held prior to the Amalgamation (the “Exchange Ratio”). An aggregate of 7,859,600 Common Shares were issued to the former shareholders of B.C. Corp. As part of the Transaction, Chris Neville, Chief Executive Officer of the Company, was appointed as the sole director and officer of the B.C. India Holding Subsidiary.
Prior to closing the Transaction, B.C. Corp. held a 99.37% ownership interest in an Indian holding entity (the “Indian Holding Entity”), with the Indian Holding Entity holding a controlling 67.47% ownership interest in the Indian Operating Entity. As a result of the Transaction, the B.C. India Holding Subsidiary now holds a 99.37% ownership interest in the Indian Holding Entity. Pursuant to a shareholders agreement entered into by the Indian Holding Entity and the minority shareholders of the Indian Operating Entity, the Indian Holding Entity is entitled to increase its ownership interest in the Indian Operating Entity up to 75% (on a pre-Reorganization basis, as defined below) on or before May 31, 2020, conditional on satisfying certain funding obligations. The Indian Holding Entity is expected to complete a capital reorganization on or before the end of calendar Q1, 2021 (the “Reorganization”).
Following completion of the Reorganization, the B.C. India Holding Subsidiary’s ownership interest in the Indian Holding Entity is expected to be reduced to 86.12% (on a post-Reorganization basis), and, assuming that the Indian Holding Entity satisfies its funding obligations, the Indian Holding Entity’s ownership interest in the Indian Operating Entity is expected to be reduced to 64.59% (on a post-Reorganization basis).