The Esports Entertainment Group Inc (NASDAQ: GMBL) stock price rose 30.94% despite the lack of news releases from the company. The rally could be directly attributed to the renewed investor interest in the company, given that over 14.78 million GMBL shares had changed hands at writing.
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The lack of recent releases forces us to look at the company's previous releases for clues as to why it is rallying higher today. The last significant release from the company was on August 15, 2023, when it entered into a securities purchase agreement (SPA) with an institutional investor.
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The SPA was for the purchase and sale of 1,000,000 shares of the Company’s common stock and pre-funded warrants to purchase 4,167,959 shares of common stock in a registered direct offering at an effective purchase price of $0.1935 per share or per pre-funded warrant.
The gambling company also entered into a settlement agreement with holders of its Series C Convertible Preferred Stock and Series D Convertible Preferred stock to issue common stock in partial settlement of Registration Rights Fees (RRA Fees).
The RRA Fees were connected to a delay in filing a registration statement to register the resale of common stock issuable under the Holder’s Series D Convertible Preferred Stock and common warrants despite the firm’s best efforts to avoid the delay.
Before the registered direct offering and settlement agreement, the company had announced a preferred stock dividend. The dividend payment was $0.08 per share, payable to shareholders of record as of July 15, 2023.
Given the previous releases, it is clear that today’s rally is primarily driven by investor sentiment.
Alex Igelman, Esports Entertainment’s CEO, said: “We appreciate the ongoing support of this institutional investor, which provides us with additional working capital as we continue to execute our turnaround and growth strategy to establish ourselves as a leader within the iGaming and esports markets. Since the beginning of the year, we have dramatically enhanced our balance sheet and have built a highly capital-efficient business model. Overall, I could not be more encouraged by the outlook for the business, and we look forward to announcing several upcoming milestones that have the potential to be transformative for the Company.”
Esports Entertainement (GMBL) stock price.
The Esports Entertainment (GMBL) stock price surged 30.94% to trade at $0.18, rising from Wednesday’s closing price of $0.1380.
YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY.