According to a report from eSports Observer, Activision has entered into an agreement to purchase a majority of North American eSports organisation Major League Gaming’s assets for a sum of $US46 ($63) million.
According to eSports Observer’s report the sale was authorised by Major League Gaming’s board of directors on December 21, with a letter informing stockholders of the decision distributed the following day.
An excerpt from the letter reportedly obtained by eSports Observer indicates that $US31 ($42) of the $US46 ($63) million was paid by Activision via a combination of cash and the assumption of “certain liabilities,” meaning Activision assumed some of the MLG corporation’s crippling debt. The additional $US15 ($21) million is being held in escrow pending any indemnification claims that may arise from the sale.
The reported letter also indicates that the proceeds from the sale will not be enough to cover stock liquidation for all MLG shareholders, with only certain tiers of shareholders receiving benefits from the purchase. As eSports Observer reports, that makes for some unhappy stock owners.
Stockholders not in these categories are largely meeting the decision in disbelief. Some speculate that the majority of the sale will go towards paying off MLG’s debts, leaving little to go around for the remaining stockholders. MLG has filed for multiple debt financing rounds this year alone, for a sum of over $US6 ($8) million. “I got fucked on stock,” said an affected stockholder, who wanted to remain anonymous.
It is also being reported that Major League Gaming co-founder and CEO Sundance DiGiovanni has been removed, replaced by former CFO Greg Chisholm.
Neither side of the reported agreement has been forthcoming with confirmation so far, not to surprising considering the winter holiday break is only just now winding down. We’ll update should we hear anything from either side.