Bids are due to Hilco Streambank by 30 July, with an auction taking place the following day. EBET currently operates seven igaming, online casino and sports betting brands.
The sale will include rights in trademarks, domain names, patents, copyrights, customer and transaction data, front-end website code and marketing services accounts and contracts. Also available is interest as plaintiff in litigation with potential for award of damages and shares of certain subsidiaries.
EBET counts Karamba, Hopa, Griffon Casino, BetTarget, Generation VIP, Scratch2Cash and Dansk 777 among its brands.
For the 12 months to 31 March 2024, the brands generated $21.0m (£16.5m/€19.5m) in revenue. On average, approximately 18,400 users gamble across the brands each month, with an average first-time deposit of around €127.
“A buyer of the assets has the opportunity to tap into a rapidly growing online gaming market and to expand upon the brands’ success by emphasising and/or re-entering certain markets, re-engaging the large player database, and optimising software and marketing operations,” Hilco Streambank chief commercial officer Richelle Kalnit said.
What went wrong at EBET?
The foreclosure sale comes less than three years after EBET acquired the assets from Aspire Global. The acquisition, valued at $75.9m, completed in December 2021, having been agreed a few months prior.
At the time, Esports Technologies, as it was known then before rebranding in the following May, said the deal would allow it to enter tier one regulated markets. It sounded out Great Britain, Germany and Denmark as target markets, with Aspire’s licences allowing it access.
However, just a few months after the rebrand, the cracks started to show at EBET. In August of 2022, the operator announced “significant measures” to find a path to profitability after the Aspire purchase.
The “profitability plan” aimed to produce positive monthly EBITDA immediately. EBET had incurred heavy losses even before the acquisition took place.
Undoubtedly, the stand-out action in the plan was a 54% reduction in EBET’s total number of employees and contractors. In addition, the business said it would “escalate and expand” its focus on igaming, with esports investment being cut.
EBET takes Aspire to court
Fast-forward a year or so and EBET took the step of launching legal action against Aspire. In documents filed with a Nevada court last December, EBET made several allegations against Aspire and how these have impacted its business.
First, it said Aspire and associated companies made false representations about the number of player accounts belonging to Aspire. EBET claims Aspire knowingly inflated these to get Ebet to agree to the acquisition deal.
Alleged falsities also include expenses and revenues. This includes misrepresenting operating expenses to inflate top-line annual revenue to approximately €65.0m. In relation to this, EBET also accused Aspire of breaching representations and warranties in the share purchase agreement by providing EBET with false information.
In addition, EBET flagged Aspire’s process to secure an online gaming licence in Germany. It alleged Aspire knew it would not qualify for a German licence. This, EBET said, is because it supposedly missed a basic payment as part of the process.
Btobet also took legal action against Aspire in a separate case. This alleges Aspire breached obligations within a special purchase agreement, which was dated September 2020. This is related to Aspire’s €20m acquisition of Btobet at the time.
Aspire was later acquired by NeoGames in a SEK4.3bn (£344.1m/€402.3m/$423.5m) deal, with that combined business then snapped up by Aristocrat to form part of its new interactive arm.