Galaxy Racer and RTE Merger Continues to Take Shape

Key insights

6 takeaways

01
Riva Technology and Entertainment (RTE) and Galaxy Racer (GXR) have signed a formal implementation agreement to finalize their merger, with an expected closing date by the end of August 2023.
02
The merged entity will be rebranded as 'Celestial' and will operate as a media and sports conglomerate with a primary focus on the MENA region and the Indian subcontinent.
03
Following the acquisition of all remaining GXR shares, GXR will represent 75% of the total value of the combined RTE and MSM Corporation International group.
04
To facilitate the merger, MSM Corporation will issue approximately three times its current number of shares to GXR shareholders.
05
The companies plan to execute a 'roll-up' strategy to acquire all remaining parts of RTE’s existing businesses and will initiate a fundraising round to support the growth of the new entity.
06
The merger process has involved significant corporate reorganization at GXR, including employee restructures and shifts in business strategy, particularly within its North American operations.

Summary

Riva Technology and Entertainment (RTE), a subsidiary of MSM Corporation International Limited, has formalized an implementation agreement to acquire the remaining equity of the esports organization Galaxy Racer (GXR). This merger aims to establish a new media and sports conglomerate branded as Celestial, with a strategic focus on the Middle East and North Africa (MENA) region and the Indian subcontinent. The transaction is expected to conclude by the end of August 2023, subject to the fulfillment of specific closing conditions.

The financial structure of the deal involves MSM issuing shares to GXR shareholders, effectively positioning GXR to represent 75% of the total value of the combined entity. Beyond the acquisition, the companies are executing a roll-up strategy to consolidate all remaining interests in RTE’s existing businesses. To support the growth and operational development of the newly formed group, the organization plans to initiate a fundraising round following the completion of the merger.

This corporate consolidation occurs alongside significant internal changes at Galaxy Racer, which has been undergoing a large-scale reorganization. These adjustments, which include employee restructuring and the refinement of business strategies, have been linked to operational challenges within the organization's North American division. While initial projections suggested a July completion, the timeline has been extended to August as the parties finalize the integration process.