Nazara Technologies Limited, a leading global gaming and sports media company, has announced its strategic investment in Moonshine Technology Private Limited (MTPL). In its board meeting held on September 12, 2024, Nazara's Board of Directors approved an investment of INR 831.51 crores, acquiring a 47.71% stake in Moonshine, subject to regulatory and shareholder approval. This investment is a part of Nazara's continued efforts to expand its presence in the skill-based online gaming industry, particularly in India.

MTPL, the parent company of several subsidiaries, operates key platforms such as PokerBaazi and SportsBaazi. PokerBaazi, India's largest poker platform, contributes over 85% of Moonshine's net revenue, while SportsBaazi, its fantasy sports vertical, generates around 12%. The target company has rapidly grown, with consolidated turnover figures of INR 102.3 crores in FY22, INR 268.0 crores in FY23, and a provisional turnover of INR 414.9 crores in FY24. Moonshine's rise can be attributed to its strong leadership, spearheaded by Founder and CEO Navkiran Singh, along with Co-Founders Puneet Singh, Varun Ganjoo, Avneet Rana, and Anirudh Chaudhry. With over 340,000 monthly active users as of May 2024, the platform has transformed India's poker ecosystem.

Nazara’s investment will be executed through two channels: a cash payment of INR 592.26 crores and the balance of INR 239.25 crores by way of a share swap, with Nazara issuing fully paid-up equity shares on a preferential basis to Moonshine’s shareholders. This transaction is subject to compliance with Chapter V of SEBI’s Issue of Capital and Disclosure Requirements (ICDR) Regulations and the Companies Act, 2013, among other laws.

In addition to the strategic equity acquisition, Nazara will inject up to INR 150 crores into Moonshine by subscribing to its Compulsory Convertible Preference Shares (CCPS). This investment will help fuel Moonshine’s growth, especially for its flagship platforms, PokerBaazi and SportsBaazi, and enable the company to strengthen its position in India’s competitive online gaming market.

PokerBaazi, the star performer, offers a range of poker tournaments and cash games, catering to both beginners and professional players. Its growth is underpinned by India's burgeoning interest in skill-based games. On the other hand, SportsBaazi, which runs fantasy sports and casual games, is carving a niche in the sports gaming segment, further diversifying Moonshine’s portfolio.

The acquisition of Moonshine, which aligns with Nazara’s long-term growth strategy, is expected to be completed within 60 days, following shareholder and regulatory approvals. Once concluded, Moonshine will become an associate of Nazara Technologies. This association will help Nazara expand its portfolio in the rapidly evolving online gaming market, leveraging Moonshine’s expertise in poker and fantasy sports. Additionally, this deal signals Nazara’s intent to capitalize on the growing popularity of online skill-based games, particularly in India, where the market for such platforms is experiencing exponential growth.

This acquisition follows Nazara’s trend of making strategic investments in gaming companies, aiming to diversify its offerings and increase its footprint in high-growth segments. Nazara has consistently positioned itself as a key player in the global gaming space, with operations spanning India, the Middle East, Africa, and Europe.

As per the regulatory framework, Nazara will also seek shareholder approval for the issuance of up to 25,07,146 fully paid-up equity shares to existing Moonshine shareholders at an issue price of INR 954.27 per share, aggregating to INR 239.25 crores. This issuance will facilitate the acquisition of 13.61% of Moonshine's equity capital on a fully diluted basis.

This investment reflects Nazara’s commitment to expanding its presence in India's booming gaming industry, leveraging the vast potential of Moonshine’s platforms. By acquiring a significant stake in a market leader like PokerBaazi, Nazara is poised to capture a substantial share of India’s online poker market, while also benefiting from the growth of SportsBaazi in the fantasy gaming space.

The upcoming Extra-Ordinary General Meeting (EGM) on October 12, 2024, will provide an opportunity for Nazara’s shareholders to approve the proposed acquisition and related financial arrangements. The notice of the EGM will be made available to the public shortly.

For investors and stakeholders, this transaction marks a critical step in Nazara’s growth trajectory, positioning the company to lead in one of the fastest-growing gaming markets in the world. Nazara’s strategic investment in Moonshine could significantly enhance its competitive edge in the rapidly evolving landscape of online skill-based gaming, particularly in the Indian market.

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