Golden Matrix Group Inc. Announces Debt Conversion by Meridianbet Founder to Equity

Rhea-AI Summary

Golden Matrix Group Inc. (NASDAQ: GMGI) announces that Aleksandar Milovanović, founder of its subsidiary Meridianbet, has agreed to convert $2,000,000 of debt into equity. This reduces his convertible note from $2,805,671 to $805,671. The decision reflects Milovanović's confidence in GMGI's performance and growth potential.

CEO Brian Goodman states this move sends a strong message to the market and shareholders, reducing outstanding debt and reinforcing belief in the company's potential. The conversion is expected to improve GMGI's Net Debt Leverage and provide enhanced financial flexibility for strategic initiatives and expansion efforts.

Positive

• Conversion of $2,000,000 debt to equity by Meridianbet founder
• Reduction of outstanding debt from $2,805,671 to $805,671
• Improvement in Net Debt Leverage
• Enhanced financial flexibility for strategic initiatives and expansion

Negative

• None.

Financial Analyst

This debt-to-equity conversion is a positive development for Golden Matrix Group (GMGI). The $2 million reduction in debt improves the company's balance sheet, potentially lowering interest expenses and enhancing financial flexibility. This move by Meridianbet's founder, Aleksandar Milovanović, signals strong confidence in GMGI's future prospects, which could positively influence investor sentiment. The improved Net Debt Leverage ratio strengthens GMGI's financial position, potentially making it more attractive to investors and lenders. However, it's important to note that this conversion will result in some dilution of existing shareholders' stakes. Overall, this strategic financial restructuring aligns key stakeholder interests with the company's long-term growth objectives, which is generally viewed favorably by the market.

Corporate Governance Expert

This transaction demonstrates strong alignment between management and shareholders. Milovanović's willingness to convert debt to equity showcases his commitment to GMGI's long-term success, reducing potential conflicts of interest between creditors and equity holders. This move also enhances corporate governance by simplifying the capital structure and reducing reliance on debt financing. The conversion likely improves financial ratios, potentially making GMGI more compliant with debt covenants and reducing financial risk. However, investors should monitor the terms of the equity conversion, including any potential preferential rights or voting power granted to Milovanović, to ensure fair treatment of all shareholders. Overall, this decision appears to strengthen GMGI's corporate governance framework and stakeholder alignment.

Market Research Analyst

This debt conversion could have a positive impact on GMGI's market perception. It may be interpreted as a vote of confidence from a key insider, potentially boosting investor sentiment. The improved balance sheet and reduced debt burden could make GMGI more attractive to institutional investors who prioritize financial stability. This move might also position GMGI more favorably for future acquisitions or expansion opportunities, as reduced debt often correlates with increased strategic flexibility. However, it's important to monitor how the market reacts to potential share dilution. If GMGI's stock price remains stable or increases following this announcement, it would indicate that the market views this development positively, outweighing dilution concerns. Investors should watch for any changes in analyst recommendations or institutional holdings as indicators of shifting market sentiment.

LAS VEGAS, NV, Sept. 10, 2024 (GLOBE NEWSWIRE) -- Golden Matrix Group Inc. (NASDAQ: GMGI) (“GMGI” or “the Company”) is pleased to announce that Aleksandar Milovanović, the founder of wholly owned GMGI subsidiary, Meridianbet, has agreed to convert $2,000,000 of debt owed to him from the Company’s recent acquisition of Meridianbet into equity in the Company.

The debt, previously held by Mr. Milovanović in the form of a convertible note totalling $2,805,671, will now be reduced to $805,671 as part of this agreement.

This strategic decision highlights Milovanović's confidence in Golden Matrix Group’s performance and his commitment to ensuring the Company continues its significant growth trajectory.

Brian Goodman, CEO of Golden Matrix Group, commented, "This move sends a strong message to the market and to our shareholders. Mr. Milovanović’s decision to convert his debt to equity reflects both his and the Company’s confidence in Golden Matrix’s short- and long-term outlooks. This action not only reduces our outstanding debt, but reinforces our belief in the Company's potential for sustained growth. We are excited about our path forward and performance to date, and the management team extends our gratitude to Mr. Milovanović for his continued support and confidence in the Company’s vision."

The conversion of debt to equity also improves the Company’s already strong Net Debt Leverage. Additionally, this move aligns the interests of key stakeholders with GMGI’s long-term prospects for further growth and overall continued success. Moreover, it is expected to provide GMGI with enhanced financial flexibility as it continues to focus on its various strategic initiatives and expansion efforts.

GMGI remains committed to building strong relationships with stakeholders while driving sustainable growth and value creation.

About Golden Matrix Group
Golden Matrix Group, based in Las Vegas, NV, is a leading B2B and B2C gaming technology company utilizing proprietary technology and operating globally across multiple international markets. The B2B division of Golden Matrix develops and licenses branded gaming platforms for its extensive list of clients, and RKings, its B2C division, operates a high-volume eCommerce site enabling end users to enter paid-for competitions on its proprietary platform in authorized markets.

About Meridianbet
Founded in 2001 and acquired by Golden Matrix in April 2024, Meridianbet Group is a well-established online sports betting and gaming group, licensed and/or currently operating in 17 jurisdictions across Europe, Africa, and South America. Meridianbet’s successful business model utilizes proprietary technology and scalable systems, thus allowing it to operate in multiple countries and currencies and with an omni-channel approach to markets, including retail, desktop online, and mobile.

Connect with us
ir@goldenmatrix.com
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https://www.instagram.com/goldenmatrixgroup/
https://x.com/meridianbet_ofc
ir@meridianbet.com

ICR:
Brett Milotte
Brett.Milotte@icrinc.com

FORWARD-LOOKING STATEMENTS

Certain statements made in this press release contain forward-looking information within the meaning of applicable securities laws, including within the meaning of the Private Securities Litigation Reform Act of 1995 (“forward-looking statements”). Words such as “strategy,” “expects,” “continues,” “plans,” “anticipates,” “believes,” “would,” “will,” “estimates,” “intends,” “projects,” “goals,” “targets” and other words of similar meaning are intended to identify forward-looking statements but are not the exclusive means of identifying these statements.

Important factors that may cause actual results and outcomes to differ materially from those contained in such forward-looking statements include, without limitation, the ability of the Company to obtain the funding required to pay certain Meridianbet Group acquisition post-closing obligations, the terms of such funding, potential dilution caused thereby and/or covenants agreed to in connection therewith; potential lawsuits regarding the acquisition; dilution caused by the terms of the Note and Warrant, the Company’s ability to pay amounts due under the Note and covenants associated therewith and penalties which could be due under the Note and securities purchase agreement for failure to comply with the terms thereof; the business, economic and political conditions in the markets in which the Company operates; the effect on the Company and its operations of the ongoing Ukraine/Russia conflict and the conflict in Israel, changing interest rates and inflation, and risks of recessions; the need for additional financing, the terms of such financing and the availability of such financing; the ability of the Company and/or its subsidiaries to obtain additional gaming licenses; the ability of the Company to manage growth; the Company’s ability to complete acquisitions and the availability of funding for such acquisitions; disruptions caused by acquisitions; dilution caused by fund raising, the conversion of outstanding preferred stock, convertible securities and/or acquisitions; the Company’s ability to maintain the listing of its common stock on the Nasdaq Capital Market; the Company’s expectations for future growth, revenues, and profitability; the Company’s expectations regarding future plans and timing thereof; the Company’s reliance on its management; the fact that the sellers of the Meridianbet Group hold voting control over the Company; related party relationships; the potential effect of economic downturns, recessions, increases in interest rates and inflation, and market conditions, decreases in discretionary spending and therefore demand for our products and services, and increases in the cost of capital, related thereto, among other affects thereof, on the Company’s operations and prospects; the Company’s ability to protect proprietary information; the ability of the Company to compete in its market; the effect of current and future regulation, the Company’s ability to comply with regulations and potential penalties in the event it fails to comply with such regulations and changes in the enforcement and interpretation of existing laws and regulations and the adoption of new laws and regulations that may unfavorably impact our business; the risks associated with gaming fraud, user cheating and cyber-attacks; risks associated with systems failures and failures of technology and infrastructure on which the Company’s programs rely; foreign exchange and currency risks; the outcome of contingencies, including legal proceedings in the normal course of business; the ability to compete against existing and new competitors; the ability to manage expenses associated with sales and marketing and necessary general and administrative and technology investments; and general consumer sentiment and economic conditions that may affect levels of discretionary customer purchases of the Company’s products, including potential recessions and global economic slowdowns. Although we believe that our plans, intentions and expectations reflected in or suggested by the forward-looking statements we make in this press release are reasonable, we provide no assurance that these plans, intentions or expectations will be achieved.

Other important factors that may cause actual results and outcomes to differ materially from those contained in the forward-looking statements included in this communication are described in the Company’s publicly-filed reports, including, but not limited to, under the “Special Note Regarding Forward-Looking Statements,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s periodic and current filings with the SEC, including the Form 10-Qs and Form 10-Ks, including, but not limited to, the Company’s Annual Report on Form 10-K for the year ended October 31, 2023 and its Quarterly Report on Form 10-Q for the quarter ended January 31, 2024, and future periodic reports on Form 10-K and Form 10‑Q. These reports are available at www.sec.gov.

Attachment

• Golden Matrix Group Inc,

FAQ

How much debt did Aleksandar Milovanović convert to equity in Golden Matrix Group Inc. (GMGI)?

Aleksandar Milovanović converted $2,000,000 of debt into equity in Golden Matrix Group Inc. (GMGI).

What was the original amount of the convertible note held by Milovanović in GMGI?

The original amount of the convertible note held by Milovanović was $2,805,671.

How does the debt conversion affect Golden Matrix Group Inc.'s (GMGI) financial position?

The debt conversion improves GMGI's Net Debt Leverage and provides enhanced financial flexibility for strategic initiatives and expansion efforts.

Who is Aleksandar Milovanović in relation to Golden Matrix Group Inc. (GMGI)?

Aleksandar Milovanović is the founder of Meridianbet, a wholly owned subsidiary of Golden Matrix Group Inc. (GMGI).