Esports Entertainment Group pulls SportNation and RedZone brands from UK
Beleaguered firm looks to cut costs as UK operations follow the closure of its New Jersey esports betting platform
Esports Entertainment Group (EEG) is set to shutter the SportNation and RedZone brands in the UK by the end of November 2022.
EEG acquired SportNation and RedZone’s parent company Argyll Entertainment in July 2020 for $7.8m as part of its aggressive M&A strategy.
However, following a series of struggles, which has seen EEG’s share price fall by 98.06% in the last year, the group has confirmed it will pull the brands from the UK.
Customers will be able to access their accounts until 30 November, after which they will no longer be able to place bets but will be able to withdraw remaining funds until the final date of closure, 7 December.
The firm also revealed that any bets settled after 30 November will be voided and stakes returned, which will be a blow to customers with ante-post bets in good shape to return a profit.
In a statement on the SportNation website, the operator said: “It is with regret we announce that after careful deliberation, SportNation will cease trading as a UK sportsbook and online casino from the end of November 2022.
“SportNation is closing for a variety of reasons including the economics of operating a small igaming business in the UK market.”
While the SportNation site has a banner on the homepage informing visitors that Sportnation.bet is closing in the UK market, messaging about RedZoneSports.bet’s closure is discretely referenced on the left of the page: “RedZone Closure FAQ”.
In an SEC filing in October, EEG revealed the difficulties it had faced with the Argyll brands, which had led it to reduce marketing spend and curb expectations for its performance.
EEG said: “Projections for the Argyll business include continued losses into fiscal 2023 due to high levels of competition in the UK market and high regulatory burdens placed on the igaming businesses in the UK market.
“In recent months, the company has reduced its spending on marketing and has been focused on retaining existing customers and reactivating past customers. We believe these efforts will have a positive effect on our results of operations.”
Elsewhere, EEG noted there was an additional asset impairment charge on the Argyll business of $7.9m.
The shuttering of SportNation and RedZone follows EEG’s decision to close its esports betting platform Vie.gg.
Vie.gg launched in New Jersey to much fanfare, with CEO Grant Johnson expecting to draw in between $1m and $2m in revenue in its first year.
Johnson’s estimate was well off the mark, with Vie.gg returning just $590 in revenue in August. The operation in the Garden State was folded on 1 November.
The move to close the Argyll portion of the business in the UK follows EEG’s strategy to streamline its business, which saw the group put its esport assets Helix eSports, ggCircuit and Esports Gaming League up for sale.
EEG currently operates Bethard and Dino Lucky Gaming.