Astralis Group, the parent company of Danish esports organisation Astralis, announced its Board of Directors has initiated a ‘strategic review’ following a sustained plunge in its stock price.
The company is now assessing possible future directions, which include a potential delisting or merger. The news was first reported by Dust2.us.
As of March 28th, Astralis’ price per share has dropped by over 65% from its original listing of DKK 8.95 (~£1.05) in December 2019. The company admitted its shares were trading at a “material discount” to their IPO price.
Astralis said it is considering one or a mix of four options: delisting of the company’s shares, merging with another company, an issuance of new shares, or a sale of all or some of the company’s shares and/or assets. The company stressed that a combination of “all or some of the four possible transactions may also be the outcome of the strategic review.”
Astralis Group did not provide a timeframe for when it might complete the review, but said it would keep shareholders updated on the review’s progress. It added that there could be “no certainty as to the outcome of the strategic review, nor whether any potential transaction would be successfully completed.”
Despite the announcement, the Board of Directors said it believes Astralis “remains in a position to generate positive returns for its shareholders,” per the company announcement.
Astralis has a leading CS:GO team, and owns franchise slots in tournament circuits the ESL Pro League and BLAST Premier. It additionally competes and owns a franchise slot in League of Legend’s LEC.
The news comes shortly after North American esports organisation FaZe Clan, which went public in June 2022, has also faced dire financial problems.
FaZe was recently served a deficiency notice form by NASDAQ as its price per share continued to stay below the exchange’s $1 (£0.81) minimum. The company, which once valued itself at $1bn (~£800m), underwent a wave of layoffs in February.
Several other publicly traded esports companies continue to face calamities, including football star David Beckham’s Guild Esports, which has fallen by over 53% in the past year.
Just yesterday, Norwegian esports organisation Heroic announced it had secured a vital NOK 10m (~£780,000) lifeline to allow it to continue operations, after a period of uncertainty in which it said it desperately needed cash to sustain business operations.