Better Collective completes acquisition of Playmaker Capital

6 February 2024
(PRESS RELEASE) -- Better Collective announces that it has completed the previously announced plan of arrangement under the Business Corporations Act (Ontario), pursuant to which it acquired all of the issued and outstanding common shares of Playmaker Capital Inc., marking its second-largest acquisition to date. Playmaker Capital is now a wholly owned subsidiary of Better Collective. Playmaker Capital is a leading digital sports media group operating a strong portfolio of sports media brands across the Americas.
Under the terms of the transaction, Better Collective acquired all of the issued and outstanding shares of Playmaker Capital for a consideration of 0.70 CAD per Playmaker Capital Share. The consideration comprises cash and shares of Better Collective. Playmaker Capital’s shareholders (other than Playmaker Capital CEO Jordan Gnat and his affiliates with respect to certain of their Playmaker Capital Shares, as described below) were able to elect to receive, for each Playmaker Capital Share held, (i) CAD 0.70 in cash, (ii) 0.0206 of a Better Collective share or (iii) a combination of CAD 0.245 in cash and 0.0134 of a Better Collective share, subject to proration and an aggregate cap of 65% shares in Better Collective and 35% in cash in respect of such Playmaker Capital Shares. Playmaker Capital shareholders who did not make an election will receive a default consideration of CAD 0.245 in cash (35%) and 0.0134 of a Better Collective share (65%) per Playmaker Capital Share.
The two largest shareholders of Playmaker Capital prior to completion of the transaction, Relay Ventures and Jordan Gnat and his affiliates, held a combined 24% of the total amount of outstanding Playmaker Capital Shares. Jordan Gnat and his affiliates have rolled a portion of their Playmaker Capital Shares for Better Collective shares and as such will receive consideration consisting of approximately CAD 0.175 in cash (25%) and 0.0155 of a Better Collective share (75%) in respect of such rolled Playmaker Capital Shares.
With the transaction now complete, Playmaker Capital’s common shares are expected to be delisted from the TSX Venture Exchange shortly after the date hereof. Playmaker Capital will also apply to cease to be a reporting issuer under applicable Canadian securities laws.
The share consideration payable to Playmaker Capital shareholders, a total of 3,143,009 Better Collective shares, has been provided by Better Collective delivering 1,387,580 existing shares held as treasury shares and by issuing 1,755,429. Further information on the new shares is provided further below.
Playmaker Capital will be consolidated into Better Collective’s financials as per February 6th, 2024.
Jesper Søgaard, Co-founder & CEO of Better Collective, says:
“I am truly excited for the completion of the acquisition of Playmaker Capital which marks a significant step towards our vision of becoming the leading digital sports media group. Over the last few months, we have had great discussions with the management team of Playmaker and these have reinforced my confidence in the combined future of our organizations. I look forward to welcoming the entire Playmaker team and its leading sports media brands to the Better Collective group and to realize the many synergies that lie ahead for our business.”
Jordan Gnat, Co-founder & CEO of Playmaker Capital, says:
“Today the Playmaker family begins the next phase of our journey by joining the Better Collective family. As the teams have gotten to know each other over the past few months I have been inspired by the cultural fit and the excitement for this opportunity going forward by both teams. A special thank you to Jesper, Christian and the Better Collective team for the confidence you have shown in our team. We are as excited as ever to continue this journey with all of you. I would also like to thank all the Playmaker shareholders for their support of Playmaker and look forward to their continued support of Better Collective as together we become the leading digital sports media group.”
Better Collective updates long-term financial targets
Better Collective’s long-term financial targets were given during the group’s Capital Markets Day in March, 2023. Here it was stated that the financial targets included both organic and M&A growth, solely funded by cash and debt. The Playmaker Capital acquisition comes with a small dilution of around 3%, prompting Better Collective to revisit the targets.
Following the acquisition, Better Collective has updated its 2027 long-term financial targets. The revised targets are as follow:
- Revenue CAGR of +20% (unchanged)
- EBITDA margin before special items of 35-40% (previously 30-40%)
- Net debt to EBITDA below 3x (unchanged)
Having acquired Playmaker Capital increases Better Collective’s confidence in reaching the revenue CAGR target. Consequently, a narrowing of the EBITDA target to the upper end is concluded as the synergies in moving revenues from advertising towards performance marketing will increase margins towards 2027.