GameSquare to Issue 30% Stake in FanEngine Asset Deal

FanEngine securityholders would own 30% of GameSquare after the closing stock issue under a deal for substantially all of the UK company’s business assets. The SEC-filed terms add two more equity earnouts worth up to 10% in total, plus as much as $50 million in cash tied to post-closing performance.

The companies signed the Contribution Agreement on September 8. GameSquare disclosed the transaction the following day in a Form 8-K filed with the SEC. GameSquare IP Holdings, a wholly owned subsidiary, is the buyer and will take on only the liabilities specified in the agreement.

In its September 9 transaction announcement, GameSquare put an indicative value of about $15.9 million on the stock due at closing, using its September 4 share price of $2.95. That is not a fixed acquisition price. The value of the shares will ultimately depend on GameSquare’s stock price when the transaction closes.

30% Stock Issue Requires a Shareholder Vote

The base payment is entirely equity-based. FanEngine securityholders are due shares equal to 30% of GameSquare’s common stock immediately after the closing issuance.

That percentage makes shareholder approval necessary. The initial shares and the possible earnout shares together exceed the 20% threshold under Nasdaq Listing Rule 5635(a), so GameSquare must put the issuance to a stockholder vote. The new shares also need Nasdaq listing approval before the deal can close.

Two seller-designated directors are expected to join the GameSquare board after closing, subject to the eligibility and other conditions set out in the agreement.

Two 5% Blocks Ride on Revenue

The remaining stock consideration comes in two equal pieces:

FanEngine Adds Sports and Entertainment IP

GameSquare says the acquired business brings rights and commercial relationships involving Peaky Blinders, Simon’s Cat, The Two Robbies & Friends and the 4Cast Media Platform. Its aim is to add more direct fan monetization through areas such as commerce, events, ticketing and licensing to a business that already works across audience data, creators, production and agency services.

The company also introduced 2027 guidance alongside the deal. Assuming a full 12 months of FanEngine operations, GameSquare is targeting more than $150 million in revenue, gross margin above 50% and adjusted EBITDA above $30 million. These are forward-looking company targets rather than completed-deal results.

GameSquare expects the acquisition to close in the fourth quarter. Conditions include the shareholder vote, Nasdaq approval for the new shares and the other required regulatory steps. The agreement also allows either side to terminate under specified circumstances if closing has not occurred by December 31, 2026.