Bragg Gaming Group has unveiled plans for a non-brokered private placement expected to raise up to $1.3m, with company insiders and gaming industry executive Matt Davey among the proposed participants.
The Toronto and Nasdaq-listed supplier intends to issue up to 751,445 subscription receipts priced at $1.73 each. The offering remains subject to regulatory approvals and is expected to close around 19 June.
Under the terms of the transaction, each subscription receipt will automatically convert into one Bragg common share and one warrant upon the completion of certain escrow release conditions. These conditions include the successful completion of Bragg’s previously announced acquisition of Drayton International.
The company said the proceeds will primarily be used for general corporate and working capital purposes.
Subscribers will also be subject to lock-up restrictions that prevent the sale or transfer of shares and warrants for up to four months following the completion of the Drayton transaction.
Several members of Bragg’s leadership team have committed to participate in the offering, including CFO Robbie Bressler, COO Morten Tonnesen and Director Thomas Winter.
Their involvement constitutes a related-party transaction under Canadian securities regulations but qualifies for exemptions from formal valuation and minority shareholder approval requirements.
The placement will also include participation from Matt Davey, Founder and Chairman of Tekkorp Capital. Davey intends to subscribe for up to 115,607 subscription receipts and is expected to become Non-Executive Chairman of Bragg’s board following the completion of the Drayton acquisition.
Bragg estimates that, upon completion of both transactions, Davey will hold approximately 10% of the company’s issued and outstanding shares on a non-diluted basis.
The fundraising announcement follows Bragg’s recent first-quarter results, in which the company reported modest revenue growth while continuing to position the proposed Drayton acquisition as a key component of its long-term growth strategy.
Matt Davey previously acquired one million Bragg shares in a private transaction earlier this year and is expected to become the company’s Non-Executive Chairman upon completion of the Drayton deal
