01—Abstract
Summary
Summary of the 8-K filed June 2, 2021. Cited figures are marked; the original filing is the authoritative source.
Take-Two Interactive Software, Inc. (TTWO) announced on June 2, 2021, its entry into a material definitive agreement to acquire a controlling stake in Nordeus Limited, a company based in Ireland.
This acquisition involves an initial upfront payment of approximately $120.5 milliona in cash and the issuance of 515,181 unregistered shares of TTWO common stock. An additional option to acquire the remaining 5.5% of Nordeus for roughly $12.4 million is also included. The deal also features a significant earn-out component, potentially totaling up to $153 million in cash, tied to Nordeus's future EBITDA performance over the first two years post-acquisition.
The issuance of TTWO shares is subject to customary transfer restrictions, with the company committing to file a resale registration statement by June 8, 2021. This acquisition is expected to bolster Take-Two's portfolio, particularly in the mobile gaming sector, given Nordeus's established presence.
02—Key points
Key Highlights
- Take-Two Interactive has acquired 94.5% of Nordeus Limited, an Irish gaming company, for approximately $120.5 million in cash and TTWO stock.
- The deal includes an option to acquire the remaining 5.5% of Nordeus for approximately $12.4 million.
- A substantial earn-out of up to $153 million is contingent on Nordeus achieving specific EBITDA performance targets over two years.
- The acquisition consideration includes 515,181 unregistered shares of Take-Two's common stock, subject to transfer restrictions.
- Take-Two will file a registration statement for the resale of these shares by June 8, 2021.
- The agreement includes customary representations, warranties, and covenants, such as non-solicitation and non-competition clauses for the seller.
- This move likely strengthens Take-Two's position in the mobile gaming market.
03—Questions
Frequently Asked Questions
What is the primary purpose of this 8-K filing?
This 8-K filing announces Take-Two Interactive Software, Inc.'s entry into a material definitive agreement to acquire a controlling interest in Nordeus Limited. It details the financial terms, including upfront cash and stock consideration, an option for remaining shares, and a potential earn-out.
How much is Take-Two paying for Nordeus and what is the structure of the payment?
The initial acquisition of 94.5% of Nordeus involves approximately $120.5 million in cash and 515,181 unregistered shares of Take-Two's common stock. There is also an option to purchase the remaining 5.5% for about $12.4 million in cash.
What is the earn-out provision and what is its maximum value?
The Seller is entitled to earn-out payments in cash, capped at an aggregate of $153 million. These payments are based on Nordeus achieving certain EBITDA performance targets in the first two 12-month periods following the closing date.
Are there any restrictions on the shares issued as part of the acquisition?
Yes, the 515,181 Closing Consideration Shares are subject to certain transfer restrictions. These shares can be transferred in thirds at specified intervals starting from the closing date (immediately, three months after, and six months after).
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