Esports group Faze Clan bought by Jerry Jones-backed GameSquare

FaZe Holdings

20/10/2023 17:51

Oct 20 (Reuters) - Faze Holdings  FAZE.O , the esports
company that was once valued at $1 billion, is being bought by
peer GameSquare  GAME.V  in an all-stock deal after mounting
losses slammed its share price.
    The companies did not disclose the financial details of the
deal in a joint announcement on Friday, but Bloomberg News
reported that it was worth around about $17 million. 
    The move caps a tumultuous ride for Faze that went public in
2022 through a blank-check merger only to lose most if its
valuation over the course of more than a year. The company had a
market value of just $14 million, as of last close. 
    It was initially valued at $1 billion in the SPAC deal, but
the figure was later reduced to $725 million.
    GameSquare, which is backed by Dallas Cowboys owner Jerry
Jones, will own about 55% of the combined company, while current
Faze investors will own the remainder.
    More popularly known as Faze Clan, the esports brand shot to
prominence more than a decade ago when its founding members
attracted millions of viewers to YouTube gameplay videos of
"Call of Duty".
    The deal will bring back some of the founders of Faze back
to the company, with Richard Bengtson taking the mantle of CEO
of Faze, which will be an independent division of GameSquare.  
    Faze, whose loss widened to $168 million in 2022 from $36
million a year ago, ousted former CEO Lee Trink in September.
    The deal is expected to close in the fourth quarter of 2023
and GameSquare sees over $18 million in cost savings from the
purchase. 
    The boards of the both the companies have approved the deal.

 (Reporting by Zaheer Kachwala in Bengaluru; Editing by Shailesh
Kuber)
 ((Zaheer.Kachwala@thomsonreuters.com;))