EEG Strikes Deal to Sell Bethard
In light of the decision from Esports Entertainment Group (EEG) to sell its Bethard brand, this is something that could understandably be met with confusion - especially for those not in the know.
A bid, from an unnamed source, of €9.5 million has been accepted by its parent company, despite having only bought the brand for significantly more in 2021 - €16 million, representing a substantial loss.
Despite this, though, the deal does include a 12 percent net gaming revenue share over the next two years; however, it is very unlikely that this will make up for the shortfall.
Great Opportunity for Bethard Acquirer
Whichever entity has struck the deal to buy Bethard, there are a number of advantages - not only have they picked it up for what can be deemed to be significantly below market value, Bethard has licenses in both Malta and Switzerland.
The exact terms of the deal include €1.65m in cash, with a further €6.5m purchase consideration - in this case, that refers to EEG’s release from payment of its ‘contingent consideration liability’ from its acquisition of Bethard. However, the agreement has been met with optimism by EEG.
I am very pleased with the work that is being undertaken to reduce debt and focus on our core iGaming and esports assets. 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.
EEG to Take New Strategic Focus
This sale represents the start of a new direction from EEG, which will see it focus on its eSports businesses, in addition to its Lucky Dino iGaming brands.
Indeed, just recently, the company closed down its Argyll business operations as it looks to streamline its core product offering. Whether this will lead to the creation of new assets over the next year remains to be seen; however, what is clear, is that changes are happening.
With headquarters in Malta, it is certainly in an iGaming epicenter which should help it to build back up and enhance its profits in the short term.
Two of its principal assets include the esports venue software company; ggCircuit, in addition to the Esports Gaming League (EGL), a tournament platform that has a considerable following and brand strength.
However the next 12 months unfold for EEG, it will be interesting to see whether its decision to sell Bethard will turn out to be the right one, especially if the unnamed acquirer turns this into a major brand.