iCandy Interactive Limited (ASX: ICI) an Australian company with core business in mobile games and digital entertainment, announced that it has entered into an agreement with Xcademy Ltd (“Xcademy”) to invest through acquiring 20% stake in the company. Joel Morris (famous as JMX with 2.5 million subscriber network) and Oliver Bell, a gaming and blockchain entrepreneur have founded Xcademy . Xcademy intends to build up an online academy offering interactive tutorial and training to the users. The platform will be useful for those, who are willing to develop video content and keen to become a video influencer in the field of mobile games and other interactive entertainment. It will be an online mobile-first platform to offer such activities.
The transaction will be in US$200,000 cash and US$100,000 non-cash in digital advertising. Cash consideration for the stake acquisition will be funded through internally generated funds. Non-cash portion of the digital marketing will be made available from iCandy’s current game network. The payment will be made to Xcademy within 15 business days from the completion date of conditions fulfilled. There are few conditions precedent, iCandy’s rights, Founder’s rights and shareholders agreement, which have been mentioned in the update.
The management is confident about the growth of the video-capable social media and expects this trend to expand going forward. YouTube, the second most visited website in the world, has 149 million daily visitors, generating >1 billion hrs of video watched on a daily basis. The company captures these YouTube users/visitors as its target audience for marketing games. As per the company’s monetisation strategy published on 28th February 2019, the acquisition is a part of ICI’s continuous effort to target its large base of mobile gamers.
The company today, on 16 April 2019, also updated about the ICI’s acquisition of Inzen Studio Pte Ltd (“Inzen”) in continuation with the announcement made on 12th April 2017 – (a) Allotment of 27,409,412 ordinary shares at A$0.136/share to the vendors of Inzen by ICI. This “First Tranche” shall be understood as part of the consideration for this acquisition, subject to an escrow period of two years; and (b) There might be a further issue of ICI shares to SG$2 million at A$0.136/share, which shall be considered as “Future Tranches”, subject to acquiring the company’s satisfying performance hurdles.
ICI revealed that First Tranche has been completed with the issuance of 27,409,412 ordinary shares to the vendors of Inzen. Additionally, ICI informed that Inzen has not met the performance hurdle. Consequently, the Future Tranches will not be valid.
The company updated in continuation with the announcement made on 8th April 2019, by ICI regarding raising capital of A$1.5 million via private placement. ICI informed that private placement has been settled on 12th April 2019, with the issue of 25,000,000 new ordinary shares for a consideration of A$0.060 each. The shares were issued pursuant to the ICI’s capacity under norms and conditions of the listing. Participants in this private placement were existing major shareholders of ICI and AB1 (Animoca Brands Ltd).
At market close on 16 April 2019, the stock was trading at $0.059 down by 15.7% as compared to previous day’s close, with a market capitalisation of $23.44 million.