GameSquare liquidates assets, simplifies operational model

From the Personal Branding Blog

GAME, a prominent component of GameSquare Holdings, Inc., and its subsidiary Frankly Media LLC have disposed of multiple non-essential assets, garnering around $16 million. The sale, which includes Frankly’s Content Management Software now owned by Immergo, and PR distribution services taken over by XPR, forms part of a larger financial restructuring strategy designed to bolster the company’s core strengths and streamline its operational model.

Having finalized the divestiture, GAME can dedicate its resources to the burgeoning digital entertainment sector. The funds accrued from the sale of assets will be funnelled toward debt reduction, financing future acquisitions, and meeting continuous operational needs, fortifying GameSquare Holdings, Inc.’s financial standing.

Moreover, selling Frankly Media’s CMS to Immergo symbolizes a shift toward exploiting more digitally-focused technologies with vast growth potential. Conversely, transferring PR distribution services to XPR illustrates the company’s strategic decision to divest non-essential services and optimize its service offerings.

GAME’s plan is projected to yield significant long-term advantages, proffering sustainable growth and value creation for shareholders. The strategy is a crucial step toward fostering a nimble, innovation-focused company, positioning GameSquare and its entities effectively in their respective markets for future success.

These assets provided GameSquare with nearly $1.6 million in annual revenue but also incurred around $2.3 million in yearly operating expenses. The sale eradicates these costs, enhancing efficiency in GameSquare’s primary operations.

GameSquare’s strategic asset liquidation and operational simplification

By removing these financial burdens, the company is expected to boost its operational profitability.

GameSquare recently acquired FaZe Clan with an all-stock deal worth nearly $14 million and sold a 49% stake in FaZe Media to Matt Kalish for $11 million. These moves are deemed essential for reducing costs and driving profitability. GameSquare has announced several new strategic partnerships intended to grow their market accessibility and potential.

According to CEO Justin Kenna, selling non-essential assets at 1.4 times the revenue for the last 12 months represents a significant boost in valuation, as GameSquare’s current market capitalization only represents 0.4x the prior 12-months’ sales. It indicates a strategy to increase shareholder value and a commitment to redefining traditional brand interaction methods with younger generations like Gen Z’s, Gen Alphas, and Millennials.

GameSquare’s platform, featuring immersive digital games and interactive entertainment, appeals to younger audiences. The company empowers creators to monetize their offerings and reach a wider audience, heralding a revolution in the gaming industry. Also, the firm caters to almost 1 billion digital consumers and is backed by reputable investors such as Jerry Jones, owner of the Dallas Cowboys, and the Goff family, testifying to its stature in the industry.

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