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Esports Entertainment announces the sale of its Bethard iGaming business

17 February 2023
(PRESS RELEASE) -- Esports Entertainment Group, Inc. today announced that it has entered into a share purchase agreement dated 14 February 2023 to sell its Bethard iGaming business, an operator of online casino and sportsbook brands that is licensed in Malta and Sweden.

The total purchase consideration in the Purchase Agreement was determined by the parties to be approximately €9.5 million comprised of €1.65 million of cash proceeds payable to the Company at closing, with an additional €6.5 million of purchase consideration attributed to the Company's release from payment of its contingent consideration liability from the Bethard acquisition. The purchaser of the Bethard business will also assume liabilities of approximately €1.2 million. The terms of sale allow for a cash holdback of €0.15 million which may be retained by the purchaser should liabilities exceed agreed upon amounts in the Purchase Agreement. The sale of the Bethard business is expected to close during the two-week period following the signing of the Purchase Agreement, subject to customary closing conditions.

The Company entered into an Amendment and Waiver Agreement on 16 February 2023 as a condition to the closing of the sale of the Bethard business. The Amendment requires the Company to deposit 50% of the proceeds from the sale of the Bethard business in a bank account in favor of the holder of its Senior Convertible Note, dated 22 February 2022. The Amendment also requires the Company to deposit 50% of the proceeds of any permitted future sale of assets or any subsequent debt or equity offer or sale and 100% of the proceeds of any additional indebtedness incurred in the future, into such bank account in favor of the Debt Holder, or, at the option of the Debt Holder, redeem amounts under the Senior Convertible Note using such proceeds.

The Amendment also modifies the Senior Convertible Note to increase the principal balance by $2.95 million for additional interest and other amounts previously recorded by the Company as liabilities to the Debt Holder, as well as for fees for the Amendment. The Amendment further provides for a voluntary reduction in the Conversion Price (as defined in the Senior Convertible Note) when the Company issues or is deemed to issue common stock in a future registered offering at a price below the Conversion Price then in effect, to the lower issuance price in such offering, subject to certain exceptions. The Amendment also provides rights to the Debt Holder to participate in future Securities Transactions for a period of two years from the later of the date of the Amendment and the date that no payment amounts due to the Debt Holder remain outstanding.

The planned sale of the Bethard business follows the Company's previous announcement on 7 December 2022 that it was closing its Argyll business, a licensed gambling operation in the United Kingdom. With the sale of the Bethard business, and the closing of the Argyll business, the Company plans to focus on its Lucky Dino iGaming brands that operate on the Company's proprietary Idefix platform.

The Company also announced:

  • Impairment of goodwill primarily related to its iGaming reporting unit at 31 December 2022. The amount of the impairment will result in a material non-cash charge to the Company's statement of operations for the fiscal quarter ended 31 December 2022.

  • Reductions in principal outstanding under the Senior Convertible Note of $16.7 million from conversions of the Senior Convertible Note to common stock. The Company has reduced its debt from $32.2 million at September 30, 2022 to $15.5 million at 16 February 2023, before adjusting for the effects of the Amendment.

  • Closing of the sale of the Spanish gambling license on 18 January 2023 resulting in proceeds to the Company of €2.1 million, of which 50% shall be deposited in a bank account in favor of the Debt Holder.

  • Termination of a lease at an idle property on 26 January 2023, eliminating remaining total lease liability over the lease term of $0.8 million.
“I am very pleased at the work that is being undertaken to reduce debt and focus on our core iGaming and esports assets,” said Alex Igelman, CEO. “We remain committed to building a world-class esports gambling operation that is global in reach and that provides esports content and strategic services to those involved in esports gambling, as well as those seeking to enter the market. I am extremely encouraged and pleased with the speed and efficiency in which senior management effectuated these important actions."

This press release shall not constitute an offer to sell or a solicitation of an offer to buy any of our securities or any of the securities described herein, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or other jurisdiction.

Esports Entertainment announces the sale of its Bethard iGaming business is republished from iGamingAffiliatePrograms.com.


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