RTE ANNOUNCES MERGER WITH GALAXY RACER: NEW HOLDING COMPANY TO BE REBRANDED AS CELESTIAL

Highlights

• RTE has entered into a non-binding term sheet to acquire the remaining securities it does not already own in GXR 

• New holding company to be branded ‘Celestial’ with a focus on creating a media and sports conglomerate, initially targeted at the MENA region and the Indian sub-continent 

• The Transaction intends to combine RTE’s product and service businesses with GXR’s vast audience 

MSM Corporation International Limited (“MSM” or the “Company“) and its wholly owned subsidiary, Riva Technology and Entertainment Limited (RTE) are pleased to announce the signing of a non-binding term sheet for the acquisition of the remaining securities not already owned in Galaxy Racer Holdings Limited (GXR), an eSports, content creators, music, and sports powerhouse (the “Transaction”). This strategic union marks a pivotal step for both companies as they seek to combine their strengths and resources to drive the success of Celestial, a newly incorporated holding company with an ambitious initiative aimed at establishing a dominant media and sports conglomerate, initially focused on the MENA region and Indian sub-continent.

Founded by Paul Roy in 2019, GXR has emerged as a cross-media business, boasting a strong presence across North America, MENA, Southeast Asia, South Asia, and Europe. Notably, GXR recently unveiled a groundbreaking joint venture with LaLiga, set to revolutionize the sports media rights industry within the MENA region and Indian sub-continent.

Under the terms of the Transaction, RTE will acquire the remaining securities of GXR that it does not already own, consolidating their expertise and resources to unlock untapped synergies, boost sales, and enhance audience engagement, with a particular emphasis on the burgeoning young consumer market in the MENA region and Indian sub-continent. Completion of the Transaction is subject to entry into a binding agreement and to satisfaction of the conditions precedent included in such agreement.

To fuel further growth and expansion, the newly enlarged MSM/RTE group of companies plans to initiate a substantial fundraising round to attract global investors who recognize the immense potential within the gaming, sports and creator economy sectors. While MSM actively contemplates a potential listing on a recognized securities exchange, it is important to note that this intention remains subject to various external factors beyond the Company’s control.

Antoine Massad, MSM Chairman, highlights the significance of this merger, stating, “This Transaction marks a momentous milestone in our journey. Together, we are building a closed-loop ecosystem that encompasses gaming, IP, consumer product development, licensing, sports collectibles, sports content and distribution, eSports, and the creator economy. This strategic move perfectly aligns with our Celestial investment strategy, positioning ourselves to capitalize on the remarkable growth projected in gaming and eSports across the MENA region and Indian sub-continent. We are excited to tap into the immense potential of these regions and actively contribute to their thriving gaming industry.”

Paul Roy, Founder and CEO of GXR and Founder, Managing Director and CEO of MSM/RTE, shares his insights for the merger, stating, “We are pleased to announce the Transaction, a significant landmark moment resulting from meticulous planning and strategic efforts. The combination of GXR’s product and services fueled by a vast audience alongside RTE’s portfolio of successful companies that share the same vision and values is a mix that has already proven successful.

“As Celestial takes shape, both companies are primed to leverage their collective strengths, capitalize on emerging opportunities, and shape the future of the media and sports industry. The rebranded holding company shall set its sights on spearheading innovation, engaging audiences, and leaving an indelible mark on the rapidly evolving landscape.”

Transaction Summary

The key terms of the Transaction are as follows;

1. RTE currently owns approximately 12% of GXR; 
2. RTE and its parent company, MSM are considering a ‘roll-up’ whereby RTE or MSM or a newly incorporated holding company (“Celestial”) would acquire the equity in certain of RTE’s portfolio businesses that RTE does not already wholly own, including GXR (the “Roll-Up”). 
3. In connection with the Roll-Up, the newly consolidated RTE group of companies would undertake a fundraising round (the “Fundraising”). The Fundraising will be conditional on completion of the Roll-Up (“Completion”). 
4. RTE and GXR agree that once the Transaction has completed, GXR will comprise 75% of the value of the combined MSM/RTE group. As such, as part of the Transaction / immediately prior to completion of the Transaction, MSM shall issue additional shares, in the amount of 3 times its current issued share capital (the “Additional MSM Shares”) to the GXR shareholders as consideration for the acquisition at a ratio of 3:1 (3 Additional MSM Shares for every 1 GXR share) to acquire the remaining circa 78% equity in GXR that it does not already currently own.
5. The Transaction would form an integral part of the Roll-Up.

The MSM and RTE Boards have implemented appropriate protocols to manage the Transaction on the basis Mr Paul Roy is the sole director of Galaxy Racer Holdings Limited. Subject to satisfactory due diligence, MSM expects to complete the Transaction by 31 May 2023.

Corporate

The Company also wishes to advise that it has applied funds from its recent capital raise to secure RTE’s investment in; 

Pikaboom (20%) – a licensing company headed by Sandrine De Raspide (former Head of Licensing at Marvel, Sanrio, MGA Entertainment) which works with over 25 major brands primarily from Japan (www.pikaboom.gg); and

Gamecan (10%) – an emerging game developer which is due to release a significant new title in 2023 (www.gamecan.eu).

As well as to meet milestone payments in existing investments in;

Sub2R (16%) – a global technology company committed to developing products for professional content creators, eSports enthusiasts and broadcast/media markets worldwide (www.sub2r.com); and 

Valari (33%) – designers of The Valari Gaming Pillow (www.thevalari.com).

Annual Report and Annual General Meeting

MSM wishes to advise that there has been a delay in finalizing the Company’s Annual Report for the year ended 30 June 2022. The complexities and logistics involved with the acquisition of RTE and its various investment portfolio companies in February 2022 has meant that the audit process has taken longer than expected. The MSM Board expects that the Annual Report will be finalised imminently and shared with shareholders followed by a notice of annual general meeting.

MSM has recently changed its reporting year end to 31 December to better align with RTE and its investment portfolio companies to ensure group reporting is completed in a timely manner in the future.

 For further information contact: 

Investor enquiries Chris Jones

P: + 61 (0) 417 985 527

RTE Website – www.rte.com.au 

RTE LinkedIn – www.linkedin.com/company/riva-technology-and-entertainment/ 

RTE Twitter – www.twitter.com/RivaTechAndEnt 

ABOUT MSMCI

MSM Corporation International Limited’s (“MSMCI”) vision is to create a global digital media entertainment, eSports and gaming business.

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