GameSquare Esports Inc. and Engine Gaming & Media, Inc. Enter Definitive Arrangement Agreement - Seite 2

"Today's announcement is a transformative opportunity for our customers, team members, and shareholders, as we build what we believe will be one of the world's largest and most influential gaming, esports, and media companies focused on youth culture," said Justin Kenna, CEO of GameSquare. "The merger immediately expands our scale, which we expect will help us on an accelerated path to profitability in 2023, while creating an organization with a leading platform of end-to-end media, content, and technology assets. GameSquare and Engine Gaming have highly complementary core strengths, including broad product portfolios, and passionate team members committed to the gaming and esports markets. As a combined organization, we will have an enhanced platform and expanded resources, including essential data and analytic solutions, to serve a broader base of global customers and accelerate growth. I am excited by the significant opportunities we will have as a combined company to create substantial value for our shareholders."

"We are thrilled to announce the merger with GameSquare," commented Lou Schwartz, CEO of Engine Gaming. "Engine Gaming's unique technology assets, including live streaming data, analytics, influencer marketing platform, and programmatic advertising solutions enhance and expand GameSquare's capabilities in connecting brands with fans. As a full service, integrated company, we will be able to meet the needs of any brand sponsor through our SaaS revenue-based technology platforms. We believe the combined company will drive powerful growth and scale, while enabling an accelerated path to profitability."

Tom Rogers, Executive Chairman of Engine Gaming added, "This merger is the successful culmination of our previously announced strategic alternatives process. We believe the merger between GameSquare and Engine provides strong potential return for shareholders, and allows Engine's stockholders to participate in the value creation of the combined company. The transaction satisfies all the announced goals of the strategic process - greater scale, catalyzing growth, and significant cost and revenue synergies.

Transaction Highlights:

• Significant financial profile. GameSquare and Engine Gaming, combined, have delivered $70+ million of trailing twelve-month revenue (unaudited), reflecting a nearly doubling of revenues over that same period.[1]
• Enhanced financial predictability. The transaction is expected to improve the recurring and reoccurring revenue profile of the combined business. Management believes that a larger, predictable revenue profile from the entity's agency, programmatic, SaaS, sponsorships, and league fees provide an improved financial foundation for accelerated growth.
• Highly complementary businesses. Management believes that the businesses within Engine Gaming and GameSquare are highly complementary and expect significant opportunities for revenue synergies and acceleration of growth. The combination of creative digital agencies, an influencer marketing platform, innovative advertising solutions, leading programmatic businesses, an elite esports organization, audience intelligence technology, content production, and merchandise and consumer product design means that the new entity will have an unrivaled end-to-end suite of services for brands seeking to reach gaming and esports fans.
• Global client base with limited cross over. Management believes the limited overlap of existing brands and clients will provide numerous opportunities for cross selling and optimization, to delivering more outstanding outcomes to our clients, including The Kraft Heinz Group, Tyson Foods, Jack in the Box, Converse, HyperX, Epic Games, Microsoft, the Dallas Cowboys, Riot Games, Activision Blizzard, Electronic Arts, and many more.
• Large audience in gaming and esports Management believes that the combination of GameSquare and Engine Gaming may result in an audience and reach as large as any gaming and esports company currently in the market. Specifically, GameSquare has an audience of 220 million and Engine has 130 million monthly followers within the advertising network.
• Improved access to U.S. investors and capital. The combined entity intends to retain Nasdaq and TSXV dual listing under the ticker GAME. Management believes that access to the U.S. financial markets as a gaming and esports company with significant revenue scale could represent an opportunity for valuation rerating catalyst for the combined company.
• Accelerated path to profitability. The combined entity is expected be on an accelerated path to profitability in 2023 as it benefits from significant operating leverage, outsized revenue growth, and meaningful cost synergies created by the new Company.
• Experienced management and board of directors. The Company expects to greatly benefit from substantial experience of the post-Transaction management team and a strong board of directors. The leadership team will be composed of executives from GameSquare and Engine Gaming that will have deep managerial expertise supported by the talented staff and leaders throughout the two companies.

Additional Details regarding the Arrangement