Scout Gaming Group nets SEK101m in share issue as financial woes continue

Scout Gaming Group has raised SEK101m (£8.3m) in its latest share issue process as the supplier continues to battle against financial hardship.

Earlier this year, Scout Gaming Group uncovered a SEK17m commitment which it was previously unaware of and would have severely impacted cash flow.

As a result, Scout Gaming Group culled more than half of it workforce from 131 to 63 across its offices in Bergen, Norway, and the city of Lviv in Western Ukraine.

The new shares rights issue was oversubscribed by investors, with an initial 202.7 million new shares to be issued, with 245.1 million eventually subscribed for.

Each of the business’ shareholders were offered the chance to purchase nine additional shares in the company at SEK0.50 per share.

This allowed Scout Gaming Group to remove the underwriting undertakings entered into by a group of the firm’s largest shareholders.

Topline Capital Partners LP, Scobie Ward, Novobis AB, Knutsson Holdings AB and Erlinghundra AB guaranteed the issue from the outset.

The agreement saw the major shareholders approve the purchase of SEK46m worth of shares and commit to buy the remaining SEK55m if other shareholders did not choose to buy.

Of the SEK101m that has been raised, SEK2.5m will be used to cover the cost of the rights issue, with around 40% used to repay bridge financing it had taken out to support operations.

The remaining approximate 60% of the capital will be issued to the firm’s cash balance.

Scout Gaming Group’s share price was down 14% to SEK0.83 at the time of writing.

Elsewhere, bet365 recently went live with Scout Gaming Group’s real-money fantasy sports product in what was the largest commercial deal in the supplier’s history.