Scorpion to combine with ACS Sports.com
Scorpion Minerals Inc SCP
Shares issued 27,769,327 Jan 12 close $1.95
Thu 13 Jan 2000 News Release
Mr. Michael Farrugia reports
On Jan. 12, 2000, Scorpion Minerals entered into a letter of intent with
ACS Sports.com Inc., providing for a business combination of the two
companies. If completed, the business combination would result in
Scorpion's current shareholders owning 33.4 per cent of the combined entity
(21,589,238 shares) and the current stakeholders of ACS Sports owning the
remaining 66.6 per cent (43 million shares). In addition, should the
current stakeholders of ACS Sports exercise the 11,140,430 share purchase
warrants they hold in ACS Sports, they would be entitled to receive an
additional 11,140,430 shares of the combined entity based on the same
exchange ratio, reducing the interest of the current Scorpion shareholders
to 28.5 per cent.
ACS Sports, with operations in New York and Baltimore, is an exciting
Internet-based sports-related business that distributes local and regional
sports content over the Internet and develops and administers the Web sites
of major sports franchises. Traffic on Web sites developed by ACS Sports
averages more than 30 million page views per month. Through exclusive
contracts with numerous major-league baseball and other sports franchises,
ACS Sports follows a business model predicated on continuing revenue
sharing arrangements with these sports franchises. Revenue sources include
sponsorship and advertising revenue, premium content and subscription fees,
content syndication and e-commerce. E-commerce opportunities include team
merchandise sales, ticket sales, sporting gear and apparel, memorabilia and
subscription services.
Each web site developed by ACS Sports is different -- customized to reflect
the characteristics and image of each franchise. While different, each site
typically includes some combination of sports programming and content (news
and editorials, scores, statistics, player pages, team coverage, and so
forth), community building products and services (on-line chat rooms,
on-line games and contests), and e-commerce opportunities.
The market for sports content and merchandise is estimated at more than
$150-billion (U.S.) annually. More than 22 million people use the Internet
to access sports-related content and on-line merchandise revenues are more
than tripling annually.
Michael Farrugia, chairman of Scorpion, said: "We are very excited about
this potential business combination. ACS Sports has entered an exciting new
area and has assembled a strong management team that, in a very short time,
has been able to secure contracts with some of the most prestigious sports
franchises in North America. With multiple revenue streams from a variety
of different customers, we believe that ACS Sports is poised to become one
of the premier providers of sports content on the Internet."
The business combination is subject to the completion of due diligence as
well as legal, regulatory and shareholder approval and is expected to close
in the first quarter of this year.
(c) Copyright 2000 Canjex Publishing Ltd. canada-stockwatch.com
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