SYDNEY, AUSTRALIA: Emerge Gaming Limited (ASX: EM1) has executed a binding agreement to sell the Miggster Business for A$5.0 million, a bourse filing noted.
The counterparty to the sale agreement is NIBIRU e-gaming AB which is a private company registered in Sweden, formed by a private consortium of shareholders. NIBIRU e-gaming AB has advised the company that it does not intend to list on any exchange.
Due diligence undertaken indicates that the representatives of NIBIRU e-gaming AB are capable C-suite professionals that have the ability to operate the Miggster Business and that the company will have the necessary financial capacity to fulfil its financial obligations on the date of settlement of the agreement.
On 23 September 2021, the company engaged professional advisors to undertake a strategic review of Emerge’s assets and advise on realising value from the Miggster business through divestment.
Pursuant to this review, Emerge Gaming actively pursued divestment opportunities for Miggster which successfully culminated in Emerge creating value for its shareholders by selling its intellectual property relating to the Miggster Business for A$5.0 million whilst retaining its core IP and technology.
The Miggster Business is defined as:
• The IP relating to the Miggster platform including a copy of the technology source code for the Miggster Platform (but not the Company’s core IP);
• Employees and contractors dedicated to servicing the Miggster Business;
• Transfer of technology service and operational contracts dedicated to servicing the Miggster Business; and
• All other assets in connection with or associated with the operation of the Miggster Business including online stores, intellectual property, Miggster subscriber databases, office equipment and prize inventory.
Emerge’s Continuing Operations
In July 2020 Emerge launched its competitive social gaming platform using its developed technology under the “MTN Arena” brand in South Africa under a content provider agreement with MTN South Africa.
MTN is a multinational mobile network operator (MNO) servicing more than 272 million subscribers in countries across Africa and the Middle East.
This launch marked the Company’s first execution under its “Telco Strategy” and has seen Emerge successfully deliver a product to a MNO with the objective of gaining access to distribution to millions of mobile subscribers internationally.
Since launch, the Emerge operated MTN Arena platform has acquired more than 800,000 paying subscribers and continues to grow month on month, currently adding more than 100,00 new monthly paying subscribers each month. Given MTN has approximately 29 million subscribers in South Africa alone (and MTN Arena has accessed more than 0.8 million new subscribers, or 2.7%, of the MTN South Africa subscriber base), there is significant opportunity to grow.
The results of the MTN Arena platform in South Africa have provided the foundation for further extrapolation of this commercial model to the other countries across the MTN Group.
In addition, Emerge continues to target other multinational MNOs and distribution partners with millions of subscribers as the company seeks to accelerate the geographical expansion of its core technology.
Emerge has increased its investment into R&D to develop innovative esports and gaming technologies. Emerge has previously announced the development of its game streaming technology to stream AAA and premium games, new competition features (such as Head-to-Head competition), extended brand engagement features and new social engagement features.
The opportunity exists for Emerge to launch an improved feature rich version of its competitive social gaming platform under MTN Arena, ArcadeX, and new future platform offerings with the objective of accelerating subscriber acquisition performance. Emerge continues to pursue its business growth and Go-To-Market (GTM) strategies.
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