Mobile games platform Skillz to go public via merger with SPAC Flying Eagle Acquisition

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Mobile games platform Skillz Inc. said Wednesday it is going public via a merger with special purpose acquisition corporation Flying Eagle Acquisition Corp. . The deal has an implied equity valuation of $3.5 billion, or 6.3 times estimated 2022 revenue, the company said in a statement. “Today we’re a leader in casual esports and are well positioned to capture the global esports opportunity which will increasingly define the gaming market,” said Skillz Founder and Chief Executive Andrew Paradise. The CEO and chairman of Flying Eagle is Harry Sloan, who was a founding investor and board member of ZeniMax Media Inc. in 1999, the creeater and publisher of interactive entertainment and its Bethesda Game Studio. Sloan is partnered with Jeff Sagansky and Eli Baker, who together took DraftKings public in April. Skillz is expected to power more than 2 billion esports tournaments in 2020 and facilitate $1.6 billion in paid entry fees for games hosted on its platform. Mobile is currently the fastest-growing segment of the gaming market and is expected to grow to $150 billion by 2024 from $68 billion last year, said the statement, citing data from Newzoo and GlobalData. Skillz will have cash of about $250 million after the deal closes, and will use the proceeds to expand in the U.S. and international markets, support marketing and for working capital. The deal is expected to close in the fall. Flying Eagle shares rose 10% premarket and are up 7% in the last three months, while the S&P 500 has gained 15%.
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