Signa Sports, a company that is developing a blockchain-based platform to provide sports betting services, has raised $100 million from Saudi Arabia’s Public Investment Fund.
According to individuals familiar with the situation, online retailer Signa Sports United is approaching an agreement to raise money from a group of investors that includes Saudi Arabia’s national wealth fund.
Signa’s previous supporters, including Japan’s SoftBank Group Corp. 9984 1.20 percent and Abu Dhabi sovereign-wealth fund Mubadala Investment Co., will join Saudi Arabia’s Public Investment Fund, according to the individuals. It would be a kind of reunion for the three investors, who were founding members of SoftBank’s $100 billion Vision Fund, which debuted in 2016.
According to people familiar with the matter, the group’s and other investors’ total investment would be more than $370 million, and would be linked to Signa’s plan to go public in New York through its previously announced merger with Yucaipa Acquisition Corp., a special-purpose acquisition company led by California billionaire Ron Burkle. The agreement may be made public as early as Friday.
The investment is a private investment in public equity, or PIPE, which is a typical kind of structure that allows SPAC mergers to raise more money. The funds will be used to fund future business initiatives and acquisitions to help the company expand.
WiggleCRC, an online bike shop, is also being purchased by Signa.
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Berlin-based Signa is in charge of a sports e-commerce and technology platform that sells bikes, tennis equipment, and outdoor and team apparel. Fahrrad.de, Bikester, Probikeshop, CAMPZ, and Tennis-Point are among the company’s web sites, which are mainly used in Europe and the United States.
The larger firm will be valued at $3.2 billion as a result of Signa’s SPAC merger, as well as investments from PIF and others. By the end of the year, it should be finished. Signa is also purchasing online bike shop WiggleCRC from European buyout company Bridgepoint Group PLC as part of the deal.
A blank-check corporation, also known as a SPAC, raises money and trades on a stock market with the express purpose of merging with a private business and bringing it public. It may be a more efficient method of going public than the conventional initial public offering.
Signa intends to utilize the additional funds to expand its footprint in the United States. According to a business investment presentation, it hopes to take advantage of the pandemic’s increased shift to online shopping as well as the increasing use of electric bicycles.
The agreement demonstrates PIF’s commitment to sports-related initiatives. Crown Prince Mohammed bin Salman of Saudi Arabia has placed sports and entertainment at the heart of the country’s economic and social development. Last Monday, a consortium headed by the sovereign wealth fund agreed to buy Newcastle United of the English Premier League for $380 million.
Newcastle United, which plays at St James’ Park, was recently purchased by a consortium headed by Saudi Arabia’s national wealth fund.
Laurence Griffiths/PA Wire/Zuma Press/Zuma Press
For the fiscal year ending Sept. 30, Signa expects the U.S. market to contribute 9% of its overall $1.6 billion net sales. That assuming the WiggleCRC transaction is completed, as well as the company’s purchase of Tennis Express, a Texas-based tennis online store, in May. In the United States, Signa also owns Midwest Sports, an Ohio-based online tennis store.
Signa’s net revenue in the previous fiscal year was $849 million, with all of it coming from Continental Europe and the United Kingdom.
Ben Dummett can be reached at [email protected].
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