Blue Hat Interactive Entertainment Technology (BHAT.Q) announced the closure of its acquisition of 51% of Fuzhou Csfctech, and it’s two subsidiaries today, according to a press release.
Csfctech is a Chinese developer and distributor of mobile games with a portfolio of over 100 games spread out across multiple platforms, and an international user base spanning Mainland China, Japan, Taiwan, the United Arab Emirates and Africa.
“We are thrilled to have completed this transaction and look forward to working closely with the Csfctech team on expanding their portfolio of mobile games and player following. The business has grown according to both companies’ projected budgets, with Csfctech exceeding the net profit performance target of $2.2 million for 2020. Over a longer period, this combination presents an incredible opportunity for Blue Hat to drive sales through an expanded interactive gaming portfolio, increased avenues for global distribution and increased brand recognition. Our goal is to bring increasingly engaging games, AR toys and AR education to our diverse audiences, and we are confident that we have found an ideal partner in Csfctech,” said Xiaodong Chen, CEO of Blue Hat.
Blue Hat Interactive producers, develops and operates AR interactive entertainment games and toys in China, including mobile games, toys with mobile features and interactive educational materials. The company’s interactive platform allows for user experiences by connecting physical items to mobile devices. The company’s aim is community building, leveraging their proprietary technology to build an engaging, interactive and completely immersive for its users.
Here are some specifics:
- The total transaction value is RMB51.2 Million (equivalent to USD7.7736 million based on current exchange ratios.
- The transaction is to be paid through a combination of cash plus newly issued shares of Blue Hat’s ordinary shares, calculated on the weighted average volume price of 20 trading days prior to closing, with the share component not to be priced lower than the Company’s Initial Public Offering price of $4.00.
- There is a performance target where the terms of the agreement will be amended if Csfctech does not achieve certain audited net profit for the calendar year ending December 31 based upon the following criteria:
– 2020: RMB 15 Million (equivalent to USD 2.2 million) (achieved);
– 2021: RMB 25 million (equivalent to USD 3.67 million); and
– 2022: RMB 40 million (equivalent to USD 5.88 million).
- The transaction has been valued at 4X the average of the three performance targets of Csfctech as referenced above.
- The original shareholders of Csfctech shall bear joint liability for performance and debt obligations.
Shares rose a penny and a half today and are now trading at $1.275.