We’ve been reporting on the formation of Engine Media Holdings (GAME.V), since before the company was formed from the three-way merger of Torque Esports, Frankly Media and WinView Games since it was announced. It basically took three flagging esports companies and amalgamated them into a bigger company, which they’re hoping will be enough to get off the ground.
But if something’s going to fly then weight is always going to be a consideration, and that’s exactly what Engine’s done today by selling off their holdings of Ideas+Cars, the Race Media, WTF1 and driver DataBase to Ideas+Cars Holdings, a UK-based third party investment group. They’ve lowered their overhead by unloading their financing obligations towards maintaining these auto media business and other assorted liabilities. It’s also allowed Engine Media to reconfigure their board some by going to a single CEO under Lou Schwartz, with Tom Rogers staying on as executive chairman.
“Torque Esports assets that folded into Engine Media as part of the three-way merger with Winview Games and Frankly Media are critical elements of the combined company. Those assets are Stream Hatchet, the e-sports data and measurement business; UMG — Ultimate Multiparty Gaming — the e-sports competitive gaming platform; and, Eden Games, the mobile game publisher that, among other games, created F1, the leading mobile game for Formula One fans. The other auto-related businesses being sold are not focused on gaming but instead, are developing e-sport and traditional sport racing audiences with the creation and production of auto racing content,” said Rogers.
Even though they’ve offloaded the costs, Engine retains the ability to run their motorsports assets through a series of licensing deals and cross-company agreements with the acquiring group, as well as collaborate on sales, marketing and promotions for esports published games and competitions.
Engine will also be able to keep support going for racing as a category through UMG, its competitive gaming platform. The company intends to build relationships across the entire esports sector, positioning itself as the leading tournament play destination.
Altogether unloading the assets makes sense. Esports hasn’t lived up to its promise. Maybe that’s got something to do with COVID-19, or maybe it’s just that demand for big stadium games isn’t exactly all the rage in the west. But there is definitely some demand, and that’s enough for some. It’s also enough to lean into and keep expanding, and that’s what Engine intends to do.
“While we recognize the strong following the motorsport assets have, this deal allows us to apply greater focus on the biggest macro opportunities for our business. We will use our resources to invest in and build Stream Hatchet (whose CEO was just named e-sports executive of the year), UMG, Winview, Frankly Media and Eden Games,” said Schwartz.
In addition, Darren Cox, who was overseeing motorsports assets as the co-CEO of Engine has stepped down and will continue as a director on Engine’s board to the end of 2020. The company has paid him 97,000 pound sterling, reflecting a bonus previously owned, and has also granted him 75,944 RSUs, which will vest in 30 days after the grant closes.