Better Collective bolsters US division with $54m Playmaker HQ acquisition
Copenhagen-based affiliate targets enlarged social media presence with content-led M&A deal
Better Collective has agreed a cash-plus-earnout deal to acquire Florida-based sports media platform Playmaker HQ for a total acquisition cost of $54m (£42.54m).
Under the terms of the agreement, the Copenhagen-based affiliate will pay an upfront cash consideration of $15m, $1m in deferred payments, as well as a performance-related earnout payment of up to $38m, based on payments being made over the next three years.
In order to reach the maximum earn-out payment, Playmaker HQ will have to generate greater than $75m in revenue and more than $25m in EBITDA during the first three years post-acquisition.
Better Collective has confirmed that the deal will be conducted as an asset purchase in order for the affiliate to benefit from certain tax deductions related to the acquisition price.
The transaction will be funded by cash, with an option to pay some of the earn-out in Better Collective shares.
Better Collective has said it will consolidate Playmaker HQ into its accounts effective July 3, 2023. It has been confirmed that the group’s 2023 financial targets, which were recently increased, will remain unchanged.
Three operational synergies were cited by the firm as rationales behind the deal, including access to Playmaker’s current audience, its “extensive” sponsorship sales knowledge, as well as the ability to grow the business internationally beyond its native US.
Better Collective US CEO Marc Pedersen lauded the multi-million-dollar deal as being a substantial value add to the affiliate’s US ambitions.
“We have been following Playmaker HQ for some time and are excited to announce the transaction today,” Pedersen said.
“Playmaker HQ offers access to millions of sports fans in the US, the majority of which are new in the Better Collective user base.
“We are excited to help enhance these fans’ sports betting experience, while also being able to utilize Playmaker HQ’s know-how to scale the product and revenue stream across Better Collective’s global portfolio,” the US CEO added.
Headquartered in South Florida, Playmaker HQ is a content platform which specializes in providing original entertainment and sports content with exclusive athlete collaborations and creator talent mainly targeting the US market.
Playmaker HQ currently distributes more than two thousand monthly pieces of sports content mainly on Instagram, TikTok, Twitter, Snapchat, and YouTube. Its followers across these platforms has grown from seven million in 2020 to more than 20 million followers to date, with content reaching around 500 million users.
Playmaker HQ founder and CEO Brandon Harris suggested the acquisition by Better Collective was a “significant milestone” for the business and would allow it to grow.
“We cannot wait to make plays with Better Collective’s world-class team who will help us create amazing content, experiences, and opportunities, reaching an even wider audience of sports fans globally,” Harris said.
“I know our creators are going to do amazing things with the support of Better Collective’s team and resources.
“We are just scratching the surface, and we are so excited to align with Better Collective to help achieve our vision of building the world’s leading sports media group,” he added.