X1 Esports and Entertainment Ltd. (CSE:XONE) said it has closed its previously announced acquisition of ShiftRLE, an online news outlet focused on the popular video game, Rocket League.
In a statement, X1 CEO Mark Elfenbein said he is thrilled to have closed on the Shift acquisition.
"Not only has the Shift community grown considerably over the past year, but we believe that Rocket League has tremendous global appeal with fans looking for the content that Shift can offer," he said.
In connection with the acquisition of the assets of Shift, X1 has entered into consulting agreements with four vendors, who as key personnel will be responsible for the continued operation of Shift, and distributed to such persons 333,333 common shares in the capital of X1 with a deemed issue price of C$0.45 per common share.
In addition, Vancouver-based X1 is paying a cash purchase price to the vendors of US$50,000, of which US$25,000 was paid in connection with the closing of the acquisition and US$25,000 payable within 45 days of the closing date.
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The ShiftRLE vendors will also be eligible to receive earn-out payments for 36 months from the closing date as payment of a 7% share of gross revenues Shift earns to a maximum of US$250,000. The earn-out may be paid in cash or common shares at the election of the company, at a deemed price equal to the 14-day trading price prior to the payment date or such other price as may be required by the policies of the exchange.
The consideration shares will be subject to subject to a Canadian Securities Exchange-imposed hold period of four months from the date of issuance, and a contractual resale restriction that will result in 25% of the consideration shares being released six months following the closing date, and 25% being released at six-month intervals thereafter.
Las Vegas-based ShiftRLE, led by co-founders Achilleas Fotiou and Jalen Jones, has demonstrated consistent user audience growth since launching in 2020. Shift currently reaches over eight million impressions during the seasonal period of the Rocket League Championship Series (RLCS), while seeing growth of 14 million impressions during transfer periods when the roster news cycle is most active. With operations in America and Europe, the organization has established an international presence in the esports industry.
"As Rocket League continues its climb to becoming a household name in the esports and gaming worlds, our team at Shift will remain committed to being a part of it in multiple facets. X1's investment should not only reflect their belief in us, but the potential that Rocket League has as a whole. We're extremely excited to continue building Shift and to fully realize our aspirations of becoming that multimedia company that will stick around for years to come,” Elfenbein said.
With five-minute games that feature non-stop action, the car-soccer hybrid game has seen significant growth with players across demographics since its launch, now seeing global averages of 80 million players per month, according to Active Player3.
Shift is an independent news source for Rocket League fans. It first rose to prominence by getting exclusive, behind-the-scenes information on Rocket League roster moves and tryouts before they were public knowledge.
Shift plays a key role in ensuring the conversation around Rocket League esports continues beyond the pitch, through coverage and insight regarding roster transactions and general esport news, ensuring fans stay engaged even during slower competitive periods.
X1 Esports and Entertainment is a video game and media portfolio company that owns and operates a growing esports franchise, RixGG. X1 runs video game competitions by teams for cash prizes, and operations ancillary to such competitions, such as merchandise and tournaments.
Contact the author at susie@proactiveinvestors.com