Enthusiast Gaming Completes Merger With Aquilini GameCo and Luminosity to Form Global Esports and Gaming Leader

  • The combination creates leading publicly traded esports and gaming organization with $22 million in 2018 pro forma revenue on the closing of the merger backed by $55 million in the financing, with a combined global audience reach of approximately 200 million
  • Merged assets and reach to include eight esports teams (including management of the Vancouver Titans Overwatch League franchise), 50+ esports influencers, 85+ gaming media websites, 900+ YouTube and Twitch channels
  • Enthusiast Gaming’s extensive media network and gamer data, combined with Luminosity’s championship-caliber teams and brand equity, expected to drive further audience growth 
  • Strategically positioned to leverage Luminosity’s robust esports brand and its audience through Enthusiast Gaming’s monetization and ad tech platform

TORONTO and VANCOUVER, British Columbia, Sept. 03, 2019 (GLOBE NEWSWIRE) — J55 Capital Corp. (“J55“) (TSX-V: FIVE.P) and Enthusiast Gaming Holdings Inc. (TSX.V:EGLX) (OTCQB:EGHIF), (“Enthusiast” or the “Company”) are pleased to announce that they, along with Luminosity Gaming Inc. (“Luminosity Gaming”) and Aquilini GameCo Inc. (“GameCo”), have completed their previously announced transactions, as described below, resulting in the formation of the leading publicly traded esports and gaming media organization in North America. The merged entity, to be called Enthusiast Gaming Holdings Inc. (“Enthusiast Gaming”), is expected to commence trading on the TSX Venture Exchange (“TSXV”) on or about September 9, 2019, under the symbol “EGLX”.

Menashe Kestenbaum, President of Enthusiast Gaming, commented,

Our vision when we founded Enthusiast was to build the largest, vertically integrated esports and gaming company in the world. The merger with Aquilini GameCo and Luminosity was a strategic decision that positions us as a dominant player in the gaming industry and unlocks access to Luminosity’s 60 million dedicated esports fans and one of the largest esports franchises. I look forward to working with our new partners to continue to build and diversify Enthusiast Gaming across the esports, gaming and entertainment sectors.”

Enthusiast is a party to a long-term management services agreement with the Vancouver Titans to manage the team which was founded in 2018 and is competing in its first season in the Overwatch League. Overwatch League is an esports competition with 20 teams across six countries and three continents, all centered on the popular first-person shooter game Overwatch.  Enthusiast is also party to a long-term services support agreement with Vancouver Arena Limited Partnership (“VALP”) pursuant to which VALP will provide Enthusiast with a broad range of marketing and business support services, including corporate partnership and selling support, retail support, brand association and marketing support (to be provided by Canucks Sports and Entertainment), esports planning and execution, digital and social media support and back-office support.

J55 also announced today a second consolidation (the “Second Consolidation”, which together with the First Consolidation (as defined in the joint management information circular of J55 and Enthusiast dated July 23, 2019), are herein referred to as the “Consolidations”) of the issued and outstanding common shares of the merged entity on the basis of 8 post-First Consolidation J55 Shares for 1 post-Second Consolidation J55 Share.

Plan of Arrangement

J55 and Enthusiast have completed their previously announced arrangement (the “Arrangement“), pursuant to which J55 has acquired all of the issued and outstanding common shares of Enthusiast (the “Enthusiast Shares”) by way of a plan of arrangement under the Business Corporations Act (Ontario).

Under the terms of the Arrangement, each former Enthusiast Shareholder received 4.22 post-First Consolidation J55 Shares for each Enthusiast Share held immediately prior to the Arrangement (the “Consideration“). It is anticipated that the Enthusiast Shares will be delisted from the TSXV effective as of the close of trading on or about September 4, 2019.

In order to receive the Consideration, registered shareholders of Enthusiast Shares will be required to deposit their share certificate(s) or direct registration statement(s) representing Enthusiast Shares, together with the duly completed letter of transmittal, with TSX Trust Company, the depositary under the Arrangement. Shareholders whose Enthusiast Shares are registered in the name of a broker, dealer, bank, trust company or another nominee should contact their nominee regarding the receipt of the Consideration.

Arrangement Agreement, to acquire common shares in the capital of J55 at the same conversion ratio applicable to the Enthusiast Shares. All other terms governing the Enthusiast Options, including, but not limited to, the expiry term, vesting and the conditions to and the manner of exercise will be the same as the terms that were in effect immediately prior to the Effective Date.

Warrants to purchase Enthusiast Shares (the “Enthusiast Warrants”), other than those that have been exercised prior to August 30, 2019 (the “Effective Date”), will continue to remain outstanding as Enthusiast Warrants which, upon exercise, will entitle the holder thereof to receive, in lieu of the number of Enthusiast Shares to which such holder was theretofore entitled upon exercise of such Enthusiast Warrants, the Consideration that such holder would have been entitled to be issued and receive if, immediately prior to the Effective Date, such holder had been the registered holder of the number of Enthusiast Shares to which such holder was theretofore entitled upon exercise of such Enthusiast Warrants. All other terms governing the Enthusiast Warrants, including, but not limited to, the expiry term and the conditions to and the manner of exercise, will be the same as the terms that were in effect immediately prior to the Effective Date, and shall be governed by the terms of the applicable warrant indenture.

Amalgamation of J55 and GameCo

Immediately prior to the completion of the Arrangement, J55 completed the acquisition of GameCo (the “Amalgamation”, together with the Arrangement, the “Transactions”). The Amalgamation was completed pursuant to the terms and conditions of an amalgamation agreement (the “Amalgamation Agreement”) between J55 and GameCo pursuant to which J55 acquired all of the outstanding securities of GameCo in exchange for securities of J55. The Amalgamation constituted J55’s Qualifying Transaction (as defined in the policies of the TSXV). On closing of the Amalgamation, all of the issued and outstanding securities of GameCo were exchanged for corresponding securities of J55 as follows:

  • each of the 309,572,066 common shares of GameCo (the “GameCo Shares”) were canceled and, in consideration thereof, each GameCo shareholder received one (post-First Consolidation) J55 common share (a “J55 Share”);
  • each of the 2,181,690 warrants to purchase GameCo Shares (the “GameCo Warrants”) were exchanged for warrants to purchase the corresponding number of (post-First Consolidation) J55 Shares on the same terms as those contained in the GameCo Warrants, and each such GameCo Warrant was canceled; and
  • each of the options to purchase GameCo Shares (the “GameCo Options”) were exchanged for options to purchase the corresponding number of (post-First Consolidation) J55 Shares on the same terms as those contained in the GameCo Options, and each such GameCo Option was canceled.

Immediately prior to the closing of the Amalgamation, J55 completed the First Consolidation, consolidating its outstanding common shares on the basis of 1.25 pre-First Consolidation shares for every one post-First Consolidation share. Convertible debentures of GameCo in the aggregate principal amount of $10 million were also exchanged for equivalent convertible debentures of J55 (the “J55 Debentures”) pursuant to the Amalgamation, but the J55 Debentures were converted into an aggregate of 22,222,222 J55 Shares at $0.45 per J55 Share pursuant to the terms of the applicable convertible debenture indenture, on completion of the Arrangement.

GameCo Acquisition of Luminosity Gaming

Prior to completing the Amalgamation, GameCo completed its acquisition of Luminosity Gaming and Luminosity Gaming (USA), LLC (“Luminosity USA”, which together with Luminosity Gaming, is herein referred to as ‘Luminosity”) (the “Luminosity Acquisition”). Luminosity is a globally recognized esports organization founded by Steve Maida. Luminosity operates in North America and is based in Toronto, Canada. GameCo completed the Luminosity Acquisition in accordance with a share purchase agreement dated February 14, 2019, pursuant to which GameCo acquired Luminosity in exchange for the payment of $1.5 million cash, the issuance of 60 million common shares of GameCo, and the issuance of a $2.0 million unsecured promissory note.

Immediately following the completion of the Luminosity Acquisition, the subscription receipts sold pursuant to GameCo’s March 2019 $25,000,200 subscription receipt financing were automatically converted into common shares of GameCo pursuant to the terms of the financing and the escrowed proceeds of the financing were released from escrow to GameCo upon satisfaction of the escrow release conditions.

Second Consolidation and Name Change

The ex-dividend date for the Second Consolidation is September 5, 2019, with the new CUSIP number being made eligible on such date. The Second Consolidation is effective as of September 9, 2019, and the J55 Shares will be listed on the TSXV on a post-Second Consolidation basis effective at the opening of the market on such date. Immediately prior to the Second Consolidation, there were 571,184,323 J55 Shares issued and outstanding. Following the Second Consolidation, there are approximately 71,398,036 J55 Shares issued and outstanding. Share certificates and direct registration statements, as applicable, will be sent to registered shareholders following completion of the Second Consolidation reflecting the adjustments to their shareholdings as a result of the Consolidations, as applicable.

In connection with the Transactions, effective as of September 5, 2019, J55 will also change its name from “J55 Capital Corp.” to “Enthusiast Gaming Holdings Inc.”, and change its trading symbol to “EGLX”. Enthusiast will change its name to “Enthusiast Gaming Properties Inc.” and the Enthusiast Shares will be delisted from the TSXV and the OTCQB, and Enthusiast will apply to cease to be a reporting issuer.

Senior Management and Board of Directors of the Merged Company

The senior management team of Enthusiast Gaming Holdings Inc. (TSX.V:EGLX) (OTCQB:EGHIF) draws from the extensive experience and expertise of the merging companies and consists of:

Chief Executive Officer: Adrian Montgomery
President: Menashe Kestenbaum
President of Esports: Steve Maida
President of EGLive: Corey Mandell
Chief Operating Officer and SVP Finance: Eric Bernofsky
Chief Financial Officer: Alex Macdonald
Chief Information Officer: Meir Bulua

The board of directors of Enthusiast consists of the following seven directors: Francesco Aquilini (Non-Executive Chair), Adrian Montgomery, Steve Maida, Menashe Kestenbaum, Alan Friedman, Ben Colabrese and Michael Beckerman.


Canaccord Genuity Corp. acted as GameCo’s exclusive financial advisor and Norton Rose Fulbright Canada LLP acted as GameCo’s legal advisor in connection with the Transactions. Haywood Securities Inc. acted as Enthusiast’s financial advisor, and Stikeman Elliott LLP and Minden Gross LLP acted as Enthusiast’s legal advisors in connection with the Arrangement. Clark Wilson LLP acted as J55’s legal advisor in connection with the Transactions.

Further information about the Transactions and Consolidations is set forth in the joint information circular of Enthusiast and J55 dated July 23, 2019, which was mailed to the shareholders of Enthusiast and J55, and which is available under their respective profiles on SEDAR at www.sedar.com.

Disclaimer for Forward-Looking Information

Certain statements in this release are forward-looking statements.  Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future.  Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements, including risks related to factors beyond the control of J55 or Enthusiast.  The risks include risks that are customary to transactions of this nature.  No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits J55 or Enthusiast will obtain from them.

This press release does not constitute an offer to sell or solicitation of an offer to buy any of the securities in the United States.  The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States or to a U.S. Person unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Please See Disclaimer


1) The author of the Article, or members of the author’s immediate household or family, do not own any securities of the companies set forth in this Article. The author determined which companies would be included in this article based on my research and understanding of the sector.

2) The Article was issued on behalf of a third party, Enthusiast Gaming Holdings Inc. Market Jar Media Inc. has or expects to receive the following amounts from Native Ads Inc. in the amount of ninety thousand CAD dollars for 15 campaign days (10 business days). In addition, Market Jar was re-engaged by Native Ads for a period of 30 campaign days (22 business days) in the amount of eighty thousand CAD dollars and re-engaged again for a period of 34 campaign days (26 business days) in the amount of one hundred thirteen thousand five hundred CAD dollars.

3) Statements and opinions expressed are the opinions of the author and not Market Jar Media Inc., its directors or officers. The author is wholly responsible for the validity of the statements. The author was not paid by Market Jar Media Inc. for this Article. Market Jar Media Inc. was not paid by the author to publish or syndicate this Article. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. Market Jar Media Inc. requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Market Jar Media Inc. relies upon the authors to accurately provide this information and Market Jar Media Inc. has no means of verifying its accuracy.

4) The Article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Market Jar Media Inc.'s terms of use and full legal disclaimer as set forth here. This Article is not a solicitation for investment. Market Jar Media Inc. does not render general or specific investment advice and the information on Market Jar Media Inc. should not be considered a recommendation to buy or sell any security. Market Jar Media Inc. does not endorse or recommend the business, products, services or securities of any company mentioned on Market Jar Media Inc.

5) Market Jar Media Inc. and its respective directors, officers and employees hold no shares for any company mentioned in the Article.