Racing game developer Motorsport Games goes public and increases its number and value of shares, aiming to accumulate a total of $60 million.
Photo credit: NASCAR Heat
Motorsport Games, the gaming division of international media and technology company Motorsport Network, increased the value and number of their shares in its initial public offering (IPO). The plan is to sell 3 million shares at $19 to $20 each, up from the 2.35 million shares at $16 to $18 each that the company had planned to offer. In doing so, the Florida-based game developer aims to raise a total of $60 million.
This means they receive 46% more in proceeds than previously anticipated. All stakes combined, the whole company could therefore be valued at up to $340 million. The developer is expected to price this Wednesday, January 13, and trade the next day, according to financial newspaper Barrons.
Who are Motorsport Games?
Most fans of racing games will have had their hands on one of the company’s titles at some point. In 2018, Motorsport Games acquired a 53.5% equity interest in 704Games, which means they hold the rights for the NASCAR Heat Series. The deal surrounding the licensing rights was extended for ten years until the end of 2029.
They are also working on a title about the British Touring Car Championship with a planned release in 2022. They reached a multi-year licensing agreement for the BTCC in May, holding the exclusive rights to develop the video game franchise for it. The company also created a mobile racing game called MOTORSPORT Predictor.
Apart from creating games, Motorsport Games is also involved in producing sim racing tournaments. During the pandemic, they hosted an esports series for NASCAR, the 24h Le Mans Virtual, Formula E and WRX.
The company reached a high this year with their projects during the pandemic. They are reported to have scored a net income of $2.4 million for the nine months that ended on September 30. In 2019 on the other hand, they experienced a loss of $4.2 million in the same period. Currently, the company has 77 full-time employees.
A boom for sim racing
Motorsport Games is not the only racing game company that made large profit during the pandemic and then went public. In December, video game giant Electronic Arts acquired the leading racing game developer Codemasters for $1.2 billion.
However, the deal was met with criticism from the fans due to EA’s practice with in-game purchases and “pay-to-win” mechanics.
Do you approve of Motorsport Games’ decision? Tell us on Twitter at @overtake_gg!