Fansunite Ent Stock Price, News & Analysis

FansUnite Entertainment Inc. (OTC: FUNFF) is described as a global sports entertainment and gaming company operating in the regulated and lawful sports betting affiliate market. According to the company’s public disclosures, its business is focused on activities such as customer acquisition, retention, support, and reactivation for sports betting and gaming operators. FansUnite has indicated that it has built its position in the North American affiliate market through its subsidiary American Affiliate, which is characterized as a North American omni-channel customer acquisition company covering both retail and digital customer activation for sportsbooks, casinos, poker, and fantasy sports platforms.

FansUnite is classified in the Other Gambling Industries industry within the broader Arts, Entertainment, and Recreation sector. Its activities are tied to the sports betting and gaming ecosystem rather than operating as a traditional casino or sportsbook. Instead, based on the company’s own description, it focuses on affiliate and customer activation functions that connect end users with regulated operators in the sports betting and gaming space.

Business focus and operating model

In its public communications, FansUnite states that its core business is centered on the sports betting affiliate market. This market involves working with regulated and lawful operators to help them acquire and engage customers. The company highlights several key functional areas within this focus:

• Customer acquisition for sports betting and gaming operators
• Customer retention and ongoing engagement
• Customer support related to affiliate-driven activity
• Customer reactivation for lapsed or inactive users

Through its subsidiary American Affiliate, FansUnite describes itself as operating an omni-channel customer acquisition platform that works across both retail and digital environments. The company’s disclosures indicate that this platform is used to drive customer activation for sportsbooks, casinos, poker, and fantasy sports platforms in North America.

Corporate developments and listing status

FansUnite has undergone notable corporate changes that affect how investors may access its shares. The company announced that its common shares would be delisted from the Toronto Stock Exchange (TSX), with the delisting effective as of the close of market on August 21, 2024. In connection with this, FansUnite also stated that it would apply to withdraw the quotation of its common shares from the OTCQB marketplace after the TSX delisting. The company later advised that a return of capital distribution was processed on August 29, 2024 for shareholders of record as of August 26, 2024.

FansUnite also disclosed that it completed the sale of all of the issued and outstanding shares of FansUnite US Inc. (FansUS), a wholly owned subsidiary that carried on its Betting Hero business, to Hero Group Corp. This transaction was described as being conducted on a cash-free, debt-free basis for a specified purchase price, with a portion of the net proceeds intended to be distributed to shareholders as a return of capital, subject to applicable conditions. Following completion of this sale, FansUnite indicated that it expected to retain a limited amount of net cash to explore new business opportunities for the economic benefit of shareholders who continue to hold an interest in FansUnite after the distribution.

Ownership and early warning reports

Several early warning reports have been issued regarding Tekkorp Holdings LLC and its acquisition of FansUnite common shares. According to these disclosures, Tekkorp entered into share purchase agreements with FansUnite and certain shareholders, resulting in the purchase and subsequent transfer of substantial blocks of common shares at a specified price per share. The early warning reports outline the number of shares and warrants held by Tekkorp, and the percentage of issued and outstanding common shares that these holdings could represent, assuming the exercise of warrants. These reports state that the purchased shares were acquired for investment purposes and that Tekkorp may, in the future, acquire or dispose of additional shares depending on market and other factors.

The early warning disclosures also state that Tekkorp relied on the “private agreement exemption” from formal take-over bid requirements under Canadian securities law. Conditions cited for this exemption include purchases from not more than five persons in the aggregate, the bid not being made generally to all securityholders, and the absence of a published market for the common shares, with a reasonable basis for determining that the consideration paid was not greater than a specified percentage of the value of the shares.

Governance and shareholder meetings

FansUnite has reported on the outcomes of shareholder meetings, including an annual general meeting and a special meeting. At the annual general meeting held in June 2024, shareholders voted on matters such as setting the number of directors, electing directors, and appointing the company’s auditor. Voting results, including percentages of votes for and against or withheld, were subsequently filed on SEDAR+.

At the special meeting held on August 13, 2024, shareholders approved resolutions related to the sale of FansUS (the Betting Hero business), the return of capital distribution, and the voluntary delisting of FansUnite’s common shares from the TSX. The company noted that a significant portion of the outstanding shares was represented in person or by proxy at this meeting and that detailed voting results were filed on SEDAR+.

Management changes

FansUnite has reported changes in its executive leadership. The company announced the departures of its Chief Executive Officer and Chief Operating Officer, effective immediately as of a specified date. In the same disclosure, FansUnite stated that its Chief Financial Officer, Graeme Moore, would retain his role and had been appointed as interim Chief Executive Officer. The company expressed appreciation for the departing executives’ service and indicated that the interim CEO would guide the company as it explores future prospects for shareholders.

Regulatory and disclosure framework

FansUnite’s public communications reference compliance with Canadian securities regulations, including National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issues and National Instrument 62-104 – Take-Over Bids and Issuer Bids. Early warning news releases explain why certain share acquisitions triggered reporting thresholds and describe the exemptions relied upon. The company also refers investors to documents filed on SEDAR+, such as management information circulars, voting results, and early warning reports, for more detailed information on transactions, shareholder approvals, and corporate actions.

Overall, FansUnite Entertainment Inc. is presented, in its own disclosures, as a sports entertainment and gaming company with a focus on the regulated sports betting affiliate market, a history of operating through its American Affiliate subsidiary in North America, and a recent corporate trajectory that includes the sale of a key subsidiary, a return of capital to shareholders, and a voluntary delisting from the TSX.