Online and mobile gaming investment vehicle MGT Capital Investments has signed an asset purchase agreement to sell its various daily fantasy sports assets to an investment group managed by Sportech Digital.
Under the deal, worth approximately $7 million (€6.2 million), MGT will receive $4 million in cash and retain an equity interest in the new venture, including common stock and warrants, with an initial valuation of up to $3 million.
The agreement will include the purchase of assets including the DraftDay daily fantasy sports arm as well as the MGT Sports business-to-business network.
Random Outcome USA, the new entity that has been formed to acquire DraftDay, will raise funds from investors led by a global investment bank.
Upon completion of financing, Sportech Digital, a subsidiary of pools and sports wagering operator Sportech, will assume management responsibilities of the new business.
Subject to financing and other closing conditions, MGT expects the deal to close before the end of the third quarter.
“Infusing a leading daily fantasy sports business with the capabilities and resources of an operator of Sportech’s calibre creates the dominant business-to-business player in the DFS space,” Random Outcome chief executive officer Curtiss Krawetz said.
Robert Ladd, chief executive of MGT, added: “DraftDay could not be going into better hands, and we firmly believe our residual interest will undergo enormous appreciation under Sportech’s leadership, relationships and access to capital.”
source : www.igamingbusiness.com