Nazara Gets NCLT Nod To Acquire Entertainment Startup Smaaash

SUMMARY

Acquisition of Smaaash Entertainment has been approved by the National Company Law Tribunal, Mumbai, by an order pronounced on May 07

The online gaming company received the letter of intent (LoI) to acquire Smaaash in August last year

Shares of Nazara closed 0.59% higher at INR 1,079.70 apiece on the BSE ending the fourth session in green

Listed gaming major Nazara Technologies has received approval from the National Company Law Tribunal (NCLT) for its resolution plan to buy insolvency-ridden sports entertainment startup Smaaash Entertainment.

In an exchange filing, Nazara said, “We wish to inform you that the resolution plan submitted by the company for acquisition of Smaaash Entertainment Private Limited has been approved by the National Company Law Tribunal, Mumbai, by an order pronounced on May 07, subject to a modification of the provisos to the term effective date.”

The online gaming company received the letter of intent (LoI) to acquire Smaaash in August last year. During which, Nazara’s board also “in-principally” approved availing a bank guarantee of up to INR 20 Cr to acquire the sports entertainment company.

The gaming major’s move to buy Smaaash comes after the NCLT commenced insolvency proceedings against the sports entertainment startup in May 2022 pertaining to the dues it owed to creditors, including the likes of Edelweiss ARC, Yes Bank, SIDBI and Mabella Investment Advisors.

Smaaash owes nearly INR 452 Cr to Edelweiss alone.

The beleaguered company’s RP Bhrugesh Amin owns listed gaming machines, go-karts and bowling alleys, among others as its assets spanning across its 13 outlets.

Shares of Nazara closed 0.59% higher at INR 1,079.70 apiece on the BSE ending the fourth session in green, compared to its previous close of INR 1,073.40 per share.

The company’s market capitalisation currently stands at INR 9,459.93 Cr ($1.1 Bn).

Nazara, in a separate regulatory filing, also mentioned that the company has completed the sale of its 94.86% equity stake held in its subsidiary OpenPlay Technologies to online poker platform PokerBaazi’s parent entity Moonshine Technology for INR 104.33 Cr.

Post the deal, Nazara will hold a total of 4,87,266 compulsorily convertible preference shares (CCPS) in Moonshine, the filing said.

Nazara’s Acquisition Hill

The development comes close on the heels of its subsidiary Absolute Sports revealing its plans to acquire two of Titan Insider Digital IPs — TJRWrestling.net and ITRWrestling.com in an all cash deal for INR 10.5 Cr.

Absolute Sports will be acquiring both the companies via its US subsidiary Sportskeeda, and the deal is expected to close within the next 45 days.

At the same time, contributing to its acquisition spree, Nazara also bought a majority stake in Mumbai-based Funky Monkeys Play Centers Private Limited for INR 43.7 Cr (around $5.01 Mn), in February.

Prior to that, Nazara’s subsidiary NODWIN Gaming announced acquiring another 93% stake in gaming and esports media company AFK Gaming for INR 7.6 Cr via cash and equity swaps, in December last year.

In terms of financial performance, Nazara Technologies’ consolidated net profit declined 53.5% to INR 13.7 Cr in Q3 FY25 from INR 29.5 Cr in the year-ago quarter.

Meanwhile, its operating revenue zoomed 66.8% to its highest ever recorded INR 534.7 Cr during the quarter under review from INR 320.4 Cr in Q3 FY24.