One of Blue Star Capital PLC’s (LON:BLU) investments in the e-sports industry is set to become one of the largest operators in Australia after agreeing a merger deal.
Diemens Esports, which was called The Cubs Esports when Blue Star invested AU$250,00 in November, has agreed to merge with event production company Critical Hit Entertainment (CHE).
READ: Blue Star Capital raises cash for shift into eSports
November saw Blue Star make six investments around the world in companies that were planning to create or acquire a competitive esports franchise to generate revenue from tournament winnings, digital marketing opportunities, sponsorship, membership, merchandise and promotional tours and events.
Diemens and CHE, which will trade under the name CHE, said they expect to be “one of the largest esport service infrastructure providers in Australia”, generating a combined revenue for 2019 of AU$600,000.
Based in Barangaroo, New South Wales, CHE runs the Australian Esports League, which includes the AEL University Cup, the AEL High School Cup the AEL Open and a corporate cup.
Post-merger the company “intends to continue to develop its esports infrastructure product in Australia and anticipates raising funding to expand into developing countries in Asia”.
Blue Star’s 13.3% stake in Diemens Esports will be converted into a 6.6% stake in the enlarged business following the merger.
“This is an exciting development for Diemens and should provide the company with a strong platform to aggressively pursue its Asian expansion plans," said Blue Star boss Tony Fabrizi.