15 Mar MOTORSPORT GAMES REACHES AGREEMENT TO ACQUIRE ALL REMAINING SHARES OF 704GAMES COMPANY
ON PER SHARE BASIS, NOT MEANINGFUL THIS YEAR, THEN ACCRETIVE
MIAMI, March 15, 2021 (GLOBE NEWSWIRE) — Pursuant to it previously disclosed offer to Ascend FS, Inc., Motorsport Games Inc. (NASDAQ: MSGM) (“Motorsport Games”), a leading racing game developer, publisher and esports ecosystem provider of official motorsport racing series throughout the world, announced today it has entered into a definitive agreement with Ascend to acquire the shares of 704Games Company owned by Ascend. The 704Games shares owned by Ascend represent 10.1% of the outstanding common stock of 704Games and will be acquired by Motorsport for the same per share consideration previously disclosed in Motorsport Game’s agreement to acquire 7.6% of the outstanding shares of 704Games from PlayFast Games, LLC.
Both the Ascend and PlayFast transactions are subject to customary conditions to closing and are expected to close on April 1, 2021. Upon closing of these transactions, Motorsport Games will own 100% of the outstanding common stock of 704Games. As previously disclosed, beginning in 2022, the acquisition of 100% of 704Games is expected to be accretive to net (loss) earnings per share of Motorsport Games on a per share basis. With 704Games becoming a wholly-owned subsidiary of Motorsport Games, the acquisition brings multiple strategic values to the forefront including the simplified financial reporting of Motorsport Games going forward.
The transactions with Ascend and PlayFast will also completely settle and release, without admitting fault or liability by any party, all claims that either PlayFast or Ascend, as a minority stockholders of 704Games, could allege or assert against Motorsport Games. In addition, pursuant to the agreement with Ascend, the 704Games derivative legal action commenced in Florida by Ascend against Motorsport Games will be dismissed with prejudice upon the closing of the transaction with Ascend.
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