Skillz, the US-based competitive esports platform developer backed by corporates Telstra, Kraft Group and Liberty Global, agreed on Tuesday to merge with special purpose acquisition company Flying Eagle Acquisition Corp.
The combined company will take the New York Stock Exchange listing taken by Flying Eagle when it went public in a $600m initial public offering in March this year.
The deal values Skillz at $3.5bn and investors including investment and financial services group Fidelity Management & Research, Wellington Management Company, Franklin Templeton and Neuberger Berman have agreed to provide $159m in financing for the business.
Founded in 2012, Skillz has built an online platform that enables mobile game developers to put on tournaments for casual games that offer prizes to winners. Its technology is expected to facilitate some $1.6bn in entry fees for games this year.
Andrew Paradise, founder and chief executive of Skillz, said: “Today we are a leader in casual esports and are well positioned to capture the global esports opportunity which will increasingly define the gaming market.
“Skillz fulfils the human desire for community and competition and is shaping the future of interactive entertainment.”
The reverse merger comes after Skillz raised an undisclosed amount from 32 Equity, the investment vehicle formed by all 32 National Football League teams, in November 2019.
The company had secured a total of $53m as of 2017 when it received $25m in a series C round co-led by mass media group Liberty Global and telecommunications firm Telstra that included financial services firm Bridge Bank, Accomplice, Wildcat Capital Management and Andy Miller.
Wildcat had led Skillz’s $15m series B round two years earlier, investing together with conglomerate Kraft Group, Sequoia Capital and private investors including Marc Lasry. Its earlier backers included Accomplice and NextView Ventures.
