Legal

PCF Group Current Report No. 41/2023: Settlement Agreement with Oblite Fund

21 August 20231 pages180 words

Summary

PCF Group S.A. reached a formal settlement agreement with the Estonian entity OÜ Blite Fund on August 21, 2023, regarding the acquisition of a majority stake in the Katowice-based studio Incuvo S.A. This agreement serves as the final resolution to financial obligations stemming from a share purchase agreement originally executed in December 2021. Under the terms of the settlement, PCF Group S.A. committed to paying an additional 2,050,000 PLN to Blite Fund to increase the purchase price for 7,143,900 shares of Incuvo S.A. The payment functions as a comprehensive settlement of all mutual claims between the two parties arising from the initial transaction and its subsequent execution. From an accounting perspective, the company allocated the full amount of this additional payment to its financial results for the second quarter of 2023. This transaction highlights the finalization of costs associated with PCF Group’s strategic expansion into the virtual reality segment, which was the primary driver behind the original acquisition of Incuvo. The scope of this disclosure is limited to the specific legal and financial reconciliation between these two corporate entities within the Polish and Estonian jurisdictions. By resolving these outstanding claims, the company has stabilized its balance sheet regarding past acquisitions and closed the legal proceedings related to the 2021 transaction. The settlement reflects a standard post-acquisition adjustment common in the gaming industry when initial purchase terms are subject to later valuation refinements or contractual disputes.

Pages

Citation

Generating citation...

Similar Documents

Legal

Raport Bieżący Nr 48/2021

PCF Group S.A. has officially expanded its development capabilities through the acquisition of a controlling interest in Incuvo S.A., a Katowice-based studio specializing in virtual reality (VR) game production and porting. On December 13, 2021, PCF Group purchased 7,143,900 shares from the Estonian entity OÜ Blite Fund, representing 50.01% of Incuvo’s share capital and total voting rights. This transaction, executed on the NewConnect market, marks a strategic move to integrate VR expertise into the broader PCF Group portfolio. The financial terms of the agreement include an initial purchase price of 19,995,776 PLN. Additionally, the seller is eligible for a performance-based earn-out payment capped at 11,595,725 PLN. This supplemental payment is contingent upon the commercial success of the title Green Hell VR, specifically measured by net profits during a defined reference period and the game’s critical reception as reflected by its Metacritic score. Beyond the share transfer, the agreement establishes long-term operational stability through non-compete clauses and management commitments. PCF Group has assumed rights and obligations from previous agreements with key Incuvo executives, ensuring that the current leadership remains in place and adheres to non-compete restrictions until at least December 31, 2024. This acquisition serves as a primary component of PCF Group’s growth strategy, aimed at diversifying its technical competencies and establishing a foothold in the emerging VR industry segment.

mergers-acquisitions investment europe+2

PCF GroupDec 2021

Legal

Resolution No. 5/2023

PCF Group S.A., the parent company of the People Can Fly studio, has executed a strategic capital increase to consolidate its ownership of the virtual reality specialist Incuvo S.A. By issuing 136,104 Series E ordinary shares at a price of 46.13 PLN per share, the company raised its share capital to 601,726.60 PLN. This issuance was conducted via a private subscription targeting two specific investors, Andrzej Wychowaniec and Radomir Kucharski, in exchange for their combined 12.24% stake in Incuvo S.A. This non-cash contribution increases the Group’s total holding in the VR studio to approximately 62.25%, signaling a deeper commitment to the virtual reality segment of the gaming industry. The transaction, finalized in February 2023, utilized a share price based on a six-month volume-weighted average to ensure a fair valuation of the 6.28 million PLN total issuance. To facilitate this acquisition, the Board excluded pre-emptive rights for existing shareholders, arguing that the move was essential for aligning the economic interests of Incuvo’s leadership with the long-term development goals of the broader Group. This integration of key VR expertise is further secured by a lock-up period on the newly issued shares, which prevents the investors from selling their holdings until the end of 2024. Following the issuance, the new shares are slated for dematerialization and listing on the Warsaw Stock Exchange. This capital restructuring serves as a tactical maneuver to strengthen the Group’s internal capabilities and streamline its corporate structure. By bringing Incuvo’s executive leadership into the parent company’s shareholder base, the Group aims to foster a more unified approach to its expanding portfolio of high-end gaming projects across multiple platforms.

investment funding europe+1

PCF GroupFeb 2023

Financial

Skonsolidowany Raport Półroczny za Okres 1.01.2023 - 30.06.2023

PCF Group S.A. reported a transition toward a self-publishing and "Game-as-a-Service" model during the first half of 2023, a period marked by significant capital restructuring and a shift from profitability to an operational loss. The Group recorded a consolidated net loss of PLN 13.1 million for H1 2023, compared to a PLN 25.5 million profit in the same period of 2022. This downturn was driven by a 24% year-over-year decrease in sales revenues to PLN 68.7 million and a sharp rise in operating costs, which reached PLN 136.9 million as the company expanded its development teams and internal publishing infrastructure. Despite the net loss, the Group’s financial position was bolstered by successful capital-raising activities. Through the issuance of Series E, F, and G shares, the Group raised approximately PLN 235 million, strengthening total equity to PLN 394.2 million and increasing cash reserves to PLN 165.4 million. A strategic partnership with Krafton, Inc., which acquired a 10% stake, and the entry of Nationale-Nederlanden OFE as a significant shareholder, provided the necessary liquidity to fund an ambitious project pipeline. This pipeline includes "Project Maverick" for Microsoft—a work-for-hire agreement valued between $30–50 million—alongside self-published titles such as Projects Dagger, Bifrost, and Victoria. The Group’s revenue remains heavily reliant on its "Production for Hire" segment, which accounted for over 75% of total income, primarily through ongoing collaborations with Square Enix and Microsoft. Notably, the Group has yet to receive royalties for *Outriders*, as sales have not yet recouped the publisher's development and promotion costs. Looking forward, the Group has set a total revenue target of PLN 3.0 billion for the 2023–2027 period and has suspended dividend payments until at least 2025 to prioritize the reinvestment of capital into its expanding portfolio of AAA titles and proprietary software frameworks.

investment mergers-acquisitions europe+1

PCF GroupSept 2023

Legal

Current Report No. 14/2021

This regulatory report, issued on April 27, 2021, details the acquisition of Game On Creative, Inc. by PCF Group S.A. (People Can Fly). The disclosure reveals previously delayed inside information regarding a non-binding letter of intent signed on March 11, 2021, and the subsequent execution of a definitive investment agreement. The transaction involves the 100% acquisition of the Montreal-based creative agency, which specializes in motion capture, cinematics, and audio for the global gaming industry. The financial structure of the deal establishes a purchase price based on eight times Game On’s 2020 EBITDA, subject to adjustments for debt, working capital, and potential leakage. The acquisition is primarily financed through a private subscription of PCF Group Series D shares issued to the seller’s trust, SG Trust. To align long-term interests, the agreement includes a five-year earn-out provision granting the seller 5% of annual EBITDA if specific targets are met. Furthermore, most newly issued shares are subject to a lock-up period, and a call option mechanism is established should the share registration face delays beyond 2021. Strategically, the acquisition integrates Game On into PCF Group’s North American operations. Samuel Girardin, the founder of Game On, transitions to the role of Studio Head at People Can Fly Canada while maintaining his presidency at Game On. PCF Group justified the initial delay in public disclosure under European Market Abuse Regulations to protect the integrity of negotiations and prevent third-party interference that could have compromised the transaction's terms or misled the public regarding the deal's certainty.

mergers-acquisitions investment europe+2

PCF GroupApr 2021

Legal

Current Report No. 47/2021

This regulatory report, issued on December 13, 2021, by PCF Group S.A., discloses previously delayed inside information regarding the acquisition of a controlling stake in Incuvo S.A. The primary purpose of the announcement is to fulfill European Union Market Abuse Regulation (MAR) requirements following the formal execution of an investment agreement. The transaction involves PCF Group S.A. acquiring between 50% plus one share and 53% of the shares in Incuvo S.A., a Katowice-based developer specializing in virtual reality (VR) gaming and VR porting. A significant portion of this acquisition, at least 49.01%, was negotiated with the Estonian-based shareholder OÜ Blite Fund. The initial non-binding term sheet was signed on October 28, 2021, which established an exclusivity period for negotiations that lasted until December 8, 2021. The disclosure explains that the public announcement was delayed from its original October date to protect the company’s interests and ensure the integrity of the negotiation process. Management determined that immediate disclosure could have invited third-party interference, potentially worsening the transaction terms or leading to public misinterpretation of the company's value while the deal's outcome remained uncertain. The scope of the report is focused on the Polish and Estonian corporate entities involved, marking a strategic expansion for PCF Group into the VR industry segment. The document confirms that all legal criteria for delaying inside information were met and that the Polish Financial Supervision Authority would be notified of the delay accordingly.

mergers-acquisitions investment market-analysis+1

PCF GroupDec 2021

Legal

Raport bieżący nr 9/2025

The report announces that PCF Group S.A., headquartered in Warsaw, has decided to record asset‑impairment write‑downs as of 31 December 2024, following the completion of analyses required for the preparation of its individual and consolidated financial statements for 2024 under Article 17(1) of the MAR Regulation. The primary purpose is to reflect the reduced recoverable value of specific investments and to align the balance sheets with current fair‑value assessments. Three distinct impairments are disclosed. A full 100 % write‑down of the costs incurred on the Bifrost project reduces the individual fixed‑asset balance by 213.493 million PLN and the consolidated fixed‑asset balance by 154.964 million PLN, simultaneously lowering the respective 2024 profit figures. A 73 % reduction of the equity stake in Incuvo S.A. cuts the individual profit and fixed‑asset value by 18.893 million PLN. Finally, a complete write‑down of goodwill allocated to Incuvo as a cash‑flow‑generating centre diminishes the consolidated profit and fixed‑asset total by 18.061 million PLN. All impairments are non‑cash in nature and do not affect EBITDA at either the individual or consolidated level. The Bifrost write‑down stems from doubts about securing financing for further development and release, while the Incuvo equity write‑down reflects a substantial decline in the fair value of the share package. The goodwill write‑down is deemed irreversible due to the same fair‑value deterioration. The board reserves the right to reverse the Bifrost and equity impairments, wholly or partially, should circumstances improve. The figures remain provisional, subject to audit verification, and will be finalized in the 2024 financial statements unless earlier legal disclosure is required. The scope covers PCF Group’s operations in Poland, addressing both standalone and group‑wide financial positions for the fiscal year 2024.

investment mergers-acquisitions europe

PCF GroupApr 2025

PCF Group Current Report No. 41/2023: Settlement Agreement with Oblite Fund

Summary

Tags

Pages

Citation

Citation

Similar Documents

Raport Bieżący Nr 48/2021

Resolution No. 5/2023

Skonsolidowany Raport Półroczny za Okres 1.01.2023 - 30.06.2023

Current Report No. 14/2021

Current Report No. 47/2021

Raport bieżący nr 9/2025