6th Jun 2023 10:57
(Alliance News) - Gfinity PLC on Tuesday said it is closing down its Esports division and selling a majority stake of its subsidiary Athlos to Tourbillon Group UK Ltd.
Gfinity shares fell 27% to 0.11 pence each in London on Tuesday morning.
Gfinity, a London-based e-sports and gaming services firm, said the sale of the 72.5% stake in Athlos is to provide growth capital "to support the business moving forward". Gfinity will retain the remaining 27.5% of the shareholding in Athlos.
The company said Athlos recorded a pretax loss of GBP500,000 on revenue of GBP400,000 in 2022.
Gfinity also is closing its Esports division, noting a "soft" e-sports market and only limited profitable growth opportunities. The company will focus on digital media and the gamer website industry.
"After a large dip in users in 2022 due to some adverse market impacts including changes in the Google search engine, the company has performed a round of cost cuts and improvements in it content as it streamlines the editorial team and makes strategic hires in search engine optimisation and tech, to increase user numbers," it said.
Chair Neville Upton said: "This has been a difficult year for digital media with the company having losses across all verticals, however after a significant re-structuring, we are confident that Gfinity will flourish without the requirement to raise further working capital. By focussing on our core web offering for gamers, we are able to remove the capital intensive businesses of software development and esports events, and focus on returning to a positive return on investment. We will update the shareholders shortly on a more detailed strategy."
By Tom Budszus, Alliance News reporter
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