GameSquare Esports Inc (CSE:GSQ) (FRA:29Q1) announced that it has acquired Cut+Sew and Zoned, a privately held marketing agency operating in the sports and esports industries.
It will fund the transaction, worth up to $7.85 million, with cash and shares.
The Toronto-headquartered company said it acquired Cut+Sew and Zoned to boost its capabilities across sports, technology, new media, music & fashion. The acquisition will bring additional marketing capabilities to GameSquare and will help to increase the brand's capabilities in numerous sectors, including traditional sports, gaming, emerging technology, new media, music and fashion, it added.
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"Cut+Sew/Zoned operates at the intersection of gaming, sports, new media, and understands how to bring the cool factor to brands and client engagements," GameSquare CEO Justin Kenna said in a statement.
"Having worked with Cut+Sew/Zoned in the past, I know the high quality of their work and also management's ability to profitably grow their business.”
GameSquare said it sees potential for Cut+Sew/Zoned to accelerate its top-line growth while generating healthy underlying earnings (EBITDA) margins of roughly 40%, based on past performance, adding to its portfolio of profitable companies.
“I expect that Cut+Sew/Zoned will be instrumental in helping to monetize Complexity Gaming's incredible media assets, and their work in sports will be an incredible addition to the agency of record agreement that was recently signed with the Dallas Cowboys,” Kenna added.
The co-founders and management of Cut+Sew/Zoned, including Matt Hilman, Devon Woodruff, and Sean Maher, will continue to operate the business, whose gaming clients include Amazon's Crown Channel, Tiv, Mavix Chairs, HyperX, and Play One Up.
“We have seen amazing growth in gaming and esports and the convergence that is taking place with traditional sports, and we think the opportunities that GameSquare is creating puts us in the right place at the right time to bring our work ethic and creativity to projects with global brands, including Complexity Gaming and the Dallas Cowboys,” Hillman said.
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