Dreams of an exit strategy that meant getting bought out became a reality for Toronto-based Gaming Nation Inc. (TSX-V:FAN). On Monday morning, the provider of tech and information to the sports and entertainment industry said it agreed to be acquired by OC Special Opportunities Fund, LP, a private investment fund managed by Orange Capital Ventures GP, LLC.
Per the deal, which FAN's board has unanimously approved, Orange Capital will pay CDN$0.95 cents in cash for each share of FAN, a 90% premium to the price of a share on February 22, 2017, the day prior to the company disclosing it was exploring strategic alternatives, including a possible sale of itself.
It's also the highest per-share price for the stock since October 2015 when it was in a slide from its all-time high of $2.65. On a fully diluted basis, the buyout price values the company at approximately CDN$44 million.
Certain members of Gaming Nation's leadership will be exchanging their shares not for cash, but for shares in Orange Capital or an affiliate of Orange Capital.
Orange Capital will owe Gaming Nation up to $4 million in a breakup fee should they terminate the deal. The acquisition is also subject to customary conditions, including FAN shareholder approval.
If all conditions are met and the acquisition completed, shares of FAN will be de-listed from the Toronto Venture Exchange and no longer publicly traded.
After closing Friday at 55 Canadian cents, shares have shot ahead 67.3% to CDN$0.92 cents, just shy of the bid price.
