TORONTO, Oct. 21, 2013 /CNW/ - Aumento Capital II Corporation ("Aumento") (TSX.V: AQT.P), a Capital Pool Company, is pleased to announce that
it has entered into a letter of intent with Goldstar Acquisitionco Inc.
("Goldstar") to complete a business combination (the "Amalgamation") whereby all of the issued and outstanding securities of Goldstar will
be exchanged for securities of Aumento. The Amalgamation is intended
to constitute the "Qualifying Transaction" of Aumento, as such term is
defined in Policy 2.4 of the Corporate Finance Manual of the TSX
Venture Exchange (the "TSXV").
Immediately preceding the Amalgamation, Goldstar, pursuant to the terms
of a share purchase agreement dated October 18, 2013 (the "Share Purchase" and, together with the Amalgamation, the "Transactions"), intends to complete the purchase from a subsidiary of Amaya Gaming
Group Inc. ("Amaya"), (TSX: AYA), an entertainment solutions provider for the regulated
gaming industry, of all of the outstanding shares of online casino
operator WagerLogic Malta Holdings Ltd. ("WagerLogic") for cash consideration of $70 million. Closing of the purchase
("Closing") is anticipated on or about December 31, 2013. The Share
Purchase includes an earn out agreement pursuant to which the vendor
thereunder may receive additional cash consideration payable on the
second and third anniversary date from Closing based on the achievement
of certain revenue targets, as well as a minimum revenue guarantee
agreement pursuant to which the vendor, in the first two years
following the Closing, may pay Goldstar cash consideration if certain
revenue targets, approximately in line with recent audited revenues,
are not achieved. Following Closing, subsidiaries of Amaya would
continue to supply WagerLogic with software, services and content to
power its online casino operations, pursuant to a services agreement.
"The proposed sale of these business-to-consumer assets is consistent
with our strategy of focusing primarily on being a single source
business-to-business supplier of diversified gaming solutions to gaming
operators," said David Baazov, CEO of Amaya Gaming Group Inc. "We
anticipate this divestiture will allow us to expand our existing
relationships and cultivate new ones with online gaming operators."
Heenan Blaikie LLP served as Canadian counsel to Amaya and its
subsidiaries and Chitiz Pathak LLP advised Goldstar in connection with
the Share Purchase.
Goldstar intends to fund the purchase of WagerLogic from the proceeds of
a private placement (see Concurrent Financing below), which is expected
to generate gross proceeds of approximately $80 million. All of the
foregoing transactions will collectively be referred to herein as the "Aumento Qualifying Transaction".
Contemporaneous with completion of the Aumento Qualifying Transaction,
Aumento will seek a listing on the Toronto Stock Exchange (the "TSX").
About Goldstar and WagerLogic
Goldstar was incorporated under the Business Corporations Act (Ontario) on September 9, 2013. Goldstar was incorporated for the
purpose of acquiring all of the outstanding shares of WagerLogic.
Goldstar's head office is located in Toronto, Ontario.
WagerLogic offers more than 150 casino titles in three currencies and
nine languages and has a customer database of over one million
registered players through its online casino websites (the "Business").
WagerLogic was incorporated under the laws of Malta on August 2, 2006.
WagerLogic owns two wholly-owned subsidiaries, CryptoLogic Operations
Limited (Malta) and WagerLogic Alderney Limited. The head offices of
WagerLogic and its subsidiaries are located in Malta and Guernsey.
WagerLogic is an indirect subsidiary of Amaya, a company listed on the
TSX. WagerLogic was acquired by Amaya in April, 2012 when it acquired
WagerLogic's parent company, CryptoLogic Limited ("CryptoLogic"). CryptoLogic had acquired the Business from the OIGE Group, its then
largest and longest-standing licensee for its Hosted Casino business.
WagerLogic's Business had revenue for the year ending December 31, 2012
and 2011 of US$17,203,912 and US$26,171,825, and net income of
US$5,824,900 and US$13,441,839, respectively (all December 31, 2012 and
2011 numbers are audited). As of June 30, 2013, the Business had total
assets of US$3,325,749 and total liabilities of US$2,095,842
(unaudited). Revenues and net income for the six months ended June 30,
2013 are US$6,010,200 and US$2,272,115 (unaudited), respectively.
The Aumento Qualifying Transaction
Subject to regulatory approval, Aumento will acquire all of the
currently issued and outstanding common shares of Goldstar. The
purchase price (the "Purchase Price") payable by Aumento for Goldstar shall be an amount equal to the number
of Goldstar common shares issued and outstanding at closing multiplied
by the issue price (the "Issue Price") per common share pursuant to the Concurrent Financing (see below).
Aumento shall satisfy the Purchase Price by the issuance of a number of
Aumento common shares equal to the Purchase Price divided by the Issue
Price. Immediately prior to or concurrently with the closing of the
Amalgamation, Aumento shall complete a share consolidation based on a
valuation of Aumento of $856,000. The Aumento common shares shall be
consolidated into a number of new common shares equal to $856,000/Issue
Canaccord Genuity Corp. (the "Agent") will act as sole bookrunner and lead agent in a private placement of
Goldstar which is expected to generate gross proceeds of approximately
$80 million (the "Concurrent Financing"). The Agent will be paid a cash commission of 5.5% of the gross
proceeds. The net proceeds from the Concurrent Financing will be used
to fund the purchase of WagerLogic and for working capital purposes.
It is currently anticipated that the board of directors of the resulting
issuer will consist of seven directors, to be made up of five nominees
of Goldstar, and two nominees of Aumento. Management of the
Corporation will include John FitzGerald as Chief Executive Officer and
President and Keith Laslop as Chief Financial Officer.
John FitzGerald is the current Chief Executive Officer and President of
Goldstar and is also currently the Chief Executive and Director of the
Interactive Gaming Council (IGC), a non-profit trade association that
serves as a collective voice for the international interactive gaming
industry. In early 2000, Mr. FitzGerald held the role of General
Counsel for CryptoLogic Inc. and was responsible for corporate
governance and compliance. CryptoLogic Inc. was listed on the TSX,
NASDAQ and the main board of the London Stock Exchange. After leaving
CryptoLogic Inc., Mr. FitzGerald continued to play a key role in a
number of initiatives relating to the online gaming industry, including
co-founding: Ethoca, which provides a secure network for card issuers
and merchants to connect to stop online fraud; and Virgin Gaming, which
acts as a social gaming community, providing an online service that
facilitates tournaments, leagues and ladders for the Xbox 360® and
PlayStation®3 video game consoles. Mr. FitzGerald attended the
University of Toronto in the Economics program and earned an LL.B from
the University of Western Ontario.
Keith Laslop, the current Chief Financial Officer of Goldstar, will act
as Chief Financial Officer of the resulting issuer. Mr. Laslop
currently serves as principal of Newcourt Capital, a boutique private
equity group. From 2004 to 2008, Mr. Laslop served as the President of
Prolexic Technologies, Inc., the world's largest, most trusted
Distributed Denial of Service (DDoS) mitigation provider. Mr. Laslop
was responsible for the performance of the company, ultimately securing
a high realization multiple for all investors. From 2001 to 2004, he
served as the Chief Financial Officer and Business Development Director
of Elixir Studios Ltd., a London-based video gaming software developer.
Prior to Elixir, Mr. Laslop served in various corporate development,
mergers and acquisitions, and gaming consultant roles in London,
England and Toronto, Canada. Mr. Laslop is a Chartered Accountant and
holds the Chartered Financial Analyst (CFA) accreditation.
Updates in respect of the management and board of directors of the
resulting issuer will be provided to the market as they may be
determined by the parties.
The material conditions required to be fulfilled by the parties prior to
closing of the Transactions include the following: (i) closing of the
Concurrent Financing; (ii) consolidation of Aumento's shares; (iii)
receiving all necessary regulatory and third party approvals and
authorizations; (iv) approval by each of the board of directors of
Aumento, Amaya, Goldstar and WagerLogic; (v) confirmation of no
material adverse change having occurred to either entity prior to
close; (vi) the completion of a definitive agreement setting forth the
terms and conditions for the Amalgamation; (vii) the completion of due
diligence satisfactory to each party; and (viii) the completion of a
sponsorship report satisfactory to the TSXV and TSX (or waiver by the
TSXV and TSX of that requirement).
It is intended that the resulting issuer will be listed on the TSX. The
parties will be seeking a waiver of any requirement for a Sponsor, but
in the event a waiver is not available, will seek a sponsorship
relationship for this transaction with an TSX and TSXV member firm, and
will update the markets accordingly. The proposed Qualifying Transaction will constitute an arm's length
transaction, and as such, will not require approval by the shareholders
ABOUT AMAYA GAMING GROUP INC.
Amaya provides a full suite of gaming products and services including
casino, poker, sportsbook, platform, lotteries and slot machines. Some
of the world's largest gaming operators and casinos are powered by
Amaya's online, mobile, and land-based products. Amaya is present in
all major gaming markets in the world with offices in North America,
Latin America and Europe. Amaya recently acquired Cryptologic, a
pioneer within online casino, Ongame, a leader within online poker, and
Cadillac Jack, a successful slot machine manufacturer. For more
information please visit www.amayagaming.com.
Completion of the Transactions is subject to a number of conditions,
including but not limited to, TSX Venture Exchange acceptance. There
can be no assurance that the Transactions will be completed as proposed
or at all. Investors are cautioned that, except as disclosed in the
management information circular or filing statement to be prepared in
connection with the Transactions, any information released or received
with respect to the Transactions may not be accurate or complete and
should not be relied upon. Trading in the securities of a capital pool
company should be considered highly speculative.
The TSX Venture Exchange Inc. has in no way passed judgement upon the
merits of the proposed Transactions and has neither approved nor
disapproved the contents of this press release.
Certain statements included herein, including those that express
expectations or estimates by Amaya of its future performance constitute
"forward-looking statements" within the meaning of applicable
securities laws. Forward-looking statements are necessarily based upon
a number of estimates and assumptions that, while considered reasonable
by Amaya at this time, are inherently subject to significant business,
economic and competitive uncertainties and contingencies. Investors are
cautioned not to put undue reliance on forward looking statements.
Except as required by law, Amaya does not intend, and undertakes no
obligation, to update any forward-looking statements to reflect, in
particular, new information or future events.
SOURCE: Aumento Capital II Corporation
For further information:
For further information about Aumento, please contact David Danziger, CEO, at (416) 641-4940 or by email at firstname.lastname@example.org. For further information about Amaya, please contact Tim Foran, Investor Relations, at +1-416 815-0700, ext. 251. For further information about Goldstar, please contact Keith Laslop, CFO at +44 208 123 5558 or by email at email@example.com.