V1 Group Plans to Acquire Crazy Sports: Establishing a "Digital + New Culture and Entertainment" Strategic Business Layout

V1 Group Limited
2018-01-05 12:39 1155

HONG KONG, Jan. 5, 2018 /PRNewswire/ -- V1 Group Limited (Stock code: 82.HK) announced that it obtains effective control over the financing and operations of Beijing Crazy Sports Management Company Limited ("Crazy Sports", Crazy Sports and its subsidiaries together called the "Crazy Sports Group"), and enjoy the economic interest and benefits of the Crazy Sports Group through the acquisition of the entire issued shares in EASY PRIME DEVELOPMENTS LIMITED ("Easy Prime"). The Crazy Sports Group is principally engaged in development and operation of online and mobile game applications, live streaming platforms and online mobile interactive game applications, online information platforms and related products of sports nature in the Mainland China.

The overall consideration of this acquisition is HK$630 million, which will be payable by cash, consideration shares and convertible bonds. The cash consideration will be HK$238,048,635, representing approximately 38% of the overall consideration; the part payable by Consideration Shares will be HK$251,691,297, which is equivalent to approximately 40% of the overall consideration, which will be satisfied by way of issue of 880,039,500 Consideration Shares at the issue price of HK$0.286 per Conversion Share by V1 Group Limited. The Consideration Shares represent approximately 26.68% of the existing issued share capital of V1 Group Limited and represent approximately 21.06% of the issued share capital of V1 Group Limited as enlarged by the allotment and issue of the Consideration Shares. In addition, the Convertible Bonds issued by V1 Group Limited will be equivalent to HK$140,260,068, approximately 22% of the overall consideration, which will be in an equivalent principal amount entitling the holder(s) thereof to convert into 449,551,500 Conversion Shares at the initial Conversion Price of HK$0.312 per Conversion Share, upon completion. The maturity date of the Convertible Bonds is four years from the date of issue and the Convertible Bonds shall not bear any interest.

As a game application developer and operator, Crazy Sports Group designs the game play, produces artwork and game interface, works on programming and operates the game application by its internal professional team. Crazy Sports Group will also work with other game application developers around the world to, among others, co-develop mobile and tablet game applications. Crazy Sports Group currently operates a total of 11 mobile game applications and has 4 mobile game applications under research and development. Meanwhile, it is also developing a series of major game applications, and targets to fully launch and publish these applications progressively starting from January 2018 worldwide with Mainland China as its primary target market. Among them, "Chinese Football Association Super League Gaming Centre" co-developed by Crazy Sports Group and Chinese Football Super League is expected to be the promotion activity of over 1,440 matches under the Chinese Football Association Super League during the years 2017 to 2022. As the sole official gaming senior partner, it is expected that such game applications with local contents and culture would be well received by the public in Mainland China. In addition, Crazy Sports Group has cooperated with international players in the gaming sectors, including a reputable games developer based in the United Kingdom. Through such agreement, Crazy Sports Group has obtained exclusive rights for six years in operating all game applications developed by such United Kingdom developer in the regions of Mainland China, Japan, Korea, India, Russia and approximately 22 Arabian countries. The Crazy Sports Group is also developing the Chinese version of its soccer manager game, namely "Soccer Manager" for entering the Chinese market. Crazy Sports Group has also worked with a famous Spanish developer and obtained the exclusive rights for five years in operating three game applications that it developed and successfully launched, and also its official gaming authorization from fourteen European football clubs. Through these cooperation with international players Crazy Sports Group benefits from technology, experience and content sharing of international standard.

Moreover, Crazy Sports Group develops and operates live streaming online platforms and online mobile interactive game applications, which allow game users to purchase virtual coins and obtain certain reward points. These live streaming online platforms hire anchors to interact with game users on a real-time basis during the sports events or virtual sports game-play in order to enhance the interaction and promote the purchase and use of virtual coins. Crazy Sports Group procures sports experts, athletics and professional commenters to provide and publish analysis, discussions, estimations, recommendations, betting rates, competition status etc. related to sports events on its own and third parties' online information platforms, primarily target at the Mainland China market. Subscribers of these platforms are required to pay subscription fees to access the information. Crazy Sports Group currently operates 1 self-developed online information platform and publishes information on 3 online platforms operated by third parties. Crazy Sports Group has a solid reputation as a game developer in the Mainland China market, and achieved total downloads of around 26.7 million and a user base of 3 million in the past one year.  

Upon completion of the acquisition, V1 Group holds the entire equity interest in the Fengkuang Tiyu (HK) Limited ("Fengkuang Tiyu") through Easy Prime. While Fengkuang Tiyu holds the entire equity interest in the WFOE which through the VIE Contracts, will have effective control over the financing and operations of Crazy Sports Group, and enjoy the economic interest and benefits of the Crazy Sports Group.

Dr. Zhang Lijun, the Chairman of the Board of V1 Group said, "The Group is very confident of the prospect of Crazy Sports. In view of the rapid development of mobile online games and sports industry, the acquisition is expected to bring synergy with the existing platform and business data of V1 Group. It will fuel the development of the Group's business segment through seizing the potential of the highly demanded online entertainment market so as to facilitate the growth in profitability. Once the acquisition is successfully completed, V1 Group will apply its tremendous success of operating China mobile game's business to tap the huge sports market of nearly RMB 5 trillion in China, so as to form a strategic business layout with 'digital + new culture and entertainment' as its core businesses."

About V1 Group Limited

V1 Group was established in 2005, listed on the Main Board of Hong Kong Stock Exchange in 2006, became the first Chinese video media enterprise listed in Hong Kong. V1 Group Limited was named the "China's Top 100 Internet Companies" three years in a row from year 2014 to 2016. After eleven years of rapid development, V1 Group's main businesses have fully covered the Internet and mobile terminals. In 2016, V1 Group successfully transformed from the new media industry group into a new economy in the internet industry, forming a strategic layout with media as the lead, financial investment as the driving force, and "digital + new culture and entertainment" as its core businesses.

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For further information, please contact:

Hill + Knowlton Strategies
Linda Pui / Elaine Qu
Tel: (852) 2894 6378 / (852) 2894 6265
Fax: (852) 2576 1990

Source: V1 Group Limited
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