GameSquare Sells 25.5% Interest in FaZe Media

Group led by FaZe Banks buys a 25.5% interest in FaZe Media. Image Credit: FaZe Banks.

Publicly traded esports and gaming company GameSquare Holdings (NASDAQ:GAME) announced Tuesday that it has sold a 25.5% interest in FaZe Media for $9.5M USD to an entity controlled by its current CEO, Richard “FaZe Banks” Bengston.

That unnamed entity secured a 25.5% interest in FaZe Media from GameSquare at a price of $1.66 per share, for a total cash consideration of $9.5M. GameSquare said in its announcement that it will use these proceeds to “invest in growth and support working capital requirements.”

After the transaction GameSquare currently owns 25.5% of FaZe Media, but notes that the purchaser has the option to “acquire up to 3,230,556 additional shares of FaZe Media held by GameSquare at fair market value, but not less than $2 per share.” GameSquare retains voting control of the transferred shares for a period of two years, and FaZe Media will continue to be consolidated into GameSquare’s financial statements. GameSquare will also continue to provide some corporate and agency services to FaZe Media as part of the agreement. GameSquare will retain and maintain ownership of FaZe Esports properties.

The company noted that FaZe Media had a revenue of $30M for the twelve months ended March 31, 2024.

This latest transaction follows an $11M investment from Matt Kalish in May, for 49% of FaZe Media. Following both of these transactions, GameSquare values FaZe Media at approximately $40M.

“Today’s announcement is a win-win for GameSquare, FaZe Media, and the greater FaZe Clan community, Justin Kenna, CEO of GameSquare said in a release. “Since completing the acquisition of FaZe Clan in March 2024 our strategy has been focused on reigniting the FaZe brand by returning its founders in a meaningful way. With the support of Matt Kalish and his direct investment in FaZe Media, we structured the new business as a creator-led IP and media company. Today’s announcement solidifies this approach by providing access to a significant stake in the business and aligning FaZe’s founders in the success of the brand.”

More details about the transaction and further comments from Kenna can be found here.