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Games and eSports partnership based around ESforce

George Miller

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Games and eSports partnership based around ESforce
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Mail.ru Group Limited, one of the largest Internet companies in the Russian-speaking Internet market, today announces the creation of a partnership around ESforce eSports business with Modern Pick, which will allow Mail.ru Group and Modern Pick to build a well-diversified eSports business, with presence in Russia/CIS as well as Europe, with access to a broader games portfolio and expertise in AAA+ games development, eSports teams, broadcasting, video production, streaming, tournament organization and venues, combined with an extensive set of media and global brand partnerships.

The BoD of Mail.ru Group approved signing of the partnership agreement. Implied valuation of ESforce as part of the transaction is $110mn (including SK Gaming, catering and merchandise businesses, disposed by Mail.ru Group previously for >$10mn, implied overall valuation of all ESforce assets acquired by Mail.ru Group totals $120mn+). Mail.ru Group is to transfer 51% stake of ESforce into Modern Pick. The transaction is anticipated to be completed in the coming months, with ESforce to be deconsolidated from the Mail.ru Group’s financials as of Q2 results reporting on a pro forma basis. In FY 2018, ESforce generated RUB2.7bn in revenues and had an EBITDA of RUB0.7bn.

Following the closure of the deal, Mail.ru Group will work with ESforce on arms-length basis, including around target advertising activity using Mail.ru Group’s services.

Deal structure:

– MRG already holds 3% of Modern Pick
– MRG transfers 51% of ESforce as contribution to Modern Pick at an implied $56mn valuation ($110mn for 100%) with the combined company having a total initial value of $350mn
– The ultimate long term size of MRG’s stake will depend on a number of operational KPIs for the combined company set for 2022 and could increase or decrease from initial level
– MRG will remain 49% shareholder of ESforce post transaction
– Third year ratchet: Mail.ru Group’s share is to be re-valuated depending on 2022 financial performance. In case the combined 2022 revenue is below certain minimum threshold MRG may exit the merged company and get 51% of ESforce shares back. Mail.ru Group also has an option to reverse the deal in case certain fundraising and asset consolidation conditions agreed as part of the Transaction are not met by Modern Pick

We remain committed to games and eSports and see this partnership as adding optionality around new monetization channels for our existing and future game content, potential to operate eSports leagues and generally play a much larger role on the global eSports market, which offers significant growth potential, in our view, having already risen by 75% since 2016 to $865.1mn in 2018 and expected to break $1bn in revenues this year, according to Newzoo. PwC sees the global e-sports market growing at a 2018-22F CAGR of 18%, from $805mn in 2018 to $1,580mn in 2022.

We expect synergies from access to a much broader European sponsorship market with wide opportunities in eSports and media projects as well as from broadening our non-violent games portfolio, attractive for sponsorship. This also means an opportunity for MY.GAMES to receive access to global advertisers and opens up opportunities for cooperation and global expansion with overall diversification of our games and eSports business.

Commenting on the transaction Vladimir Nikolsky, COO (Russia) at Mail.ru Group, said: “We are very pleased to be entering into this new business together with Modern Pick, the strong partner who works in close cooperation with such brands as ZDF, Red Bull, etc. We are pleased with the progress that ESF has made since our acquisition but we see larger opportunities for the business being part of a wider eco-system. This is entirely constant with our strategy of leveraging our dominant position in our home market while also working with partners in some areas. We look forward to working with our talented and energetic partners to further expand ESF’s reach and user offering.”

Commenting on the transaction Mathias Lauda, Vice president at Modern Pick, said: “We are really excited to be able grow the business jointly with Mail.ru Group and gain the ESF distribution expertise and the wider partnership with Mail.ru Group to expand the reach of our world class racing games. There are obvious synergies between Modern Pick with its great partnership network of ZDF and Red Bull amongst others and the ever expanding eSports network of ESF. With the number of racing and arcade genre games continuing to increase interest from the wider auto industry continues to increase both in terms of brand recognition and also as a new avenue for marketing. We look forward to working together in this.”

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eSports

PandaScore raises $6M to drive esports betting with AI-powered data

George Miller

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PandaScore raises $6M to drive esports betting with AI-powered data
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PandaScore, a startup that provides real-time data for the esports betting industry, has raised €5 million (~$6M) in recent funding. The funds will be used to expand the company’s products for bookmakers, enabling more and better esports betting experiences.

Paris-founded startup PandaScore, which supplies esports bookmakers with AI-powered statistics and odds, announces today that it has raised €5M (~$6M) in funding. The round is led by Serena, with other investors in the round being Alven, sports-tech investor KB Partners and esports owner and investor aXiomatic Gaming.

Esports is estimated to have close to 500 million fans worldwide and the industry accounts for about $1bn in global revenues. Still, it has room to grow when it comes to betting. PandaScore’s real-time AI-powered odds empower betting traders to better leverage this massive entertainment industry.

“Providing game-changing data for bookmakers is our way to fuel the growth of esports,” says PandaScore founder and CEO Flavien Guillocheau. “When bookmakers can offer great esports betting it also helps in raising sponsorships for teams and tournaments.”

Collecting data in real-time from ongoing esports matches and from official sources, PandaScore uses its proprietary artificial intelligence to sift out and analyze the most useful pieces of information as it happens. Betting traders gain an edge utilizing machine learning to set better odds and a larger esports offering.

“Bookmakers are some of the most data dependent companies out there,” says Mr. Guillocheau. “With esport tournaments and fantasy leagues becoming a more significant component of sportsbook offerings around the world, access to PandaScore’s abundance of real time esports odds and data is vital to all the bookmakers we work with. Our vision is to help esports grow by providing the data resources for any esports business.”

PandaScore taps into the trend of a new generation tuning in to esports for entertainment and betting just as much as their older peers have done with traditional sports. The trend has only been emphasized by the recent lockdowns in many countries, which have disrupted regular sports more than they have the online gaming esports industry.

Pandascore has recently signed some of the fastest growing companies in the esports entertainment and esports betting industries as clients, including fantasy esports company Sleeper and leading companion app Strafe, esports betting platform Pixelbet and leading LATAM sportsbook BetCris. The company will use the new funding for further expansion, including hiring for the team in Paris and in Malta, as well as to cover more esport titles.

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eSports

paysafecard becomes main partner to NEO in new esports partnership

George Miller

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paysafecard becomes main partner to NEO in new esports partnership
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As the 2020/2021 esports FIFA season kicks off, paysafecard and NEO are embarking on a new collaboration, with paysafecard becoming the team’s main partner. The deal with NEO, the esports team featuring the former FIFA world champion “Gorilla”, will see the paysafecard brand featured through an exclusive in-game integration, online and offline, as well as via joint social media, Twitch and YouTube activations. The partnership was initiated by sports marketing agency Weirather Wentzel & Partner (WWP Group).

paysafecard, a market leader in eCash payment solutions and part of the international specialised payment platform Paysafe, enables simple and secure online cash transactions and is available in over 650,000 points of sale across 50 countries. By using a 16-digit paysafecard PIN, customers do not need a bank account or credit card to pay online, keeping their confidential financial data secure and protected. paysafecard has been active in the gaming community since its creation in 2000 and is well known in esports circles and popular with gamers.

Meanwhile, after a successful premiere season with a place among the top 8 teams in the world at the FECWC 2020 (the team world championship of sports simulation FIFA) and a top 4 place in the eChampions League, NEO has set itself up for the new season in a very ambitious way, with strong newcomers. In addition to Gorilla, the team now also includes DFB eNational player “DullenMIKE,” the youngest FIFA major champion of all times, who is moving from VfL Wolfsburg to NEO. The line-up is completed by the young up-and-coming talents “Lenny” and “JuliusFGU,” one of Germany’s most popular FIFA content creators.

ADDED VALUE FOR THE COMMUNITY THROUGH CREATIVE STORYTELLING

Konstantinos Maragkakis, paysafecard’s esports spokesperson, comments: “paysafecard’s connection to esports has been anchored in our DNA since our company was founded 20 years ago. Our mission is to provide gaming enthusiasts with an eCash payment solution that is as safe and easy to use as cash. Our partnership with NEO, such a young and ambitious team, is an essential part of our strategy and in this case the in-game brand placement will help us further connect with our customers and demonstrate our commitment to esports.”

NEO Manager Dan Woods is looking forward to the partnership: “It is a great pleasure to finally present our main partner at the beginning of the new season. The talks with those responsible at paysafecard were very target-oriented and straightforward right from the start. The cooperation will generate much excitement, especially in the digital space. paysafecard is experienced in esports, which makes all of the discussions about content, activations and so on extremely creative. From our side, we are focused on playing a very good sports season with the new line-up and feeding our community on social media with high-quality content. I’m sure that with such a team and such a partner the new season will bring a lot of good things for us!”

Bastian Kroll, Managing Director of WWP-Germany, added: “In our opinion, paysafecard and NEO are the perfect fit. The in-game placement of a brand, which enables simplified payment transactions for in-game purchases, is really powerful. In the past two years we have promoted and expanded the topic of esports in the entire WWP-Group with experts like Ramón Reber. The COVID-19 crisis shows the opportunities this new market offers for partnerships: flexibility and crisis resistance make esports the sport of the future.”

 

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Eastern Europe

Ukraine’s UPEA Unveils Five-year Strategy for Esports Development

Niji Narayan

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Ukraine’s UPEA Unveils Five-year Strategy for Esports Development
Reading Time: < 1 minute

 

The Ukrainian Professional Esports Association (UPEA) has introduced its strategy of esports development in Ukraine for the next five years, as well as its structure and key objectives.

UPEA intends to raise funds, develop streaming studios, open an “esports ready” hotel, increase the number of international tournaments, attract investments, and more.

The Association plans to attract $100 million of investments, $42 million of which has already been made towards the purchase and development of the first “esports ready” hotel on the infrastructure base of the Dnipro Hotel. Another $20 million is planned to be invested into its reconstruction, according to a release.

“We want Ukraine to be among the world leaders, and today we have all chances to enter the TOP-5 countries with the most developed esports ecosystem,” Oleksandr Kokhanovskyy, Board Chairman for UPEA and Founder of Natus Vincere, said.

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