FuboTV to merge with virtual entertainment company FaceBank

US sports-focused streaming service and channel aggregator fuboTV is to merge with FaceBank Group, a celebrity and sports-focused virtual entertainment company.

The two parties have entered into a definitive merger agreement which will involve fuboTV become a wholly-owned subsidiary of FaceBank, and FaceBank renamed fuboTV Inc. The combined company is expected to be headquartered in New York and led by fuboTV chief executive David Gandler.

In a filing to the U.S. Securities and Exchange Commission, the agreement has been framed as an acquisition of fuboTV by FaceBank, with the deal to be paid through shares of a newly created series of FaceBank preferred stock.

FaceBank said it has obtained a secured revolving line of credit of $100m (€92.1m) for the benefit of fuboTV as an “inducement to the willingness of… fuboTV” to enter into the merger agreement. Under the terms of the deal, Facebank will provide fuboTV with a $10m loan by April 1.

Since its founding in 2015 as a soccer streaming service, fuboTV has developed into a live television streaming platform encompassing a variety of genres. Earlier this month, fuboTV added NHL Network, MLB Network and MLB Strike Zone to its offering. The additions bolstered fuboTV’s major-league line-up, which already included NBA TV and NFL Network (and NFL Red Zone).

The two parties said the proposed merger is expected to create a leading digital entertainment company, combining fuboTV’s direct-to-consumer live television streaming platform for cord-cutters with FaceBank’s technology-driven IP in sports, movies and live performances.

A statement read: “This combination will create a content delivery platform for traditional and future-form IP. FuboTV plans to leverage FaceBank’s IP sharing relationships with leading celebrities and other digital technologies to enhance its sports and entertainment offerings.”

The companies also believe the merger will position fuboTV to continue its global expansion with FaceBank’s Nexway AG, a global ecommerce and payment platform with a business presence in 180 countries, accepting payments in roughly 140 currencies. FuboTV was the first virtual multi-channel video programming distributor to commit to global expansion and in 2018 entered Europe with its launch in Spain.

Gandler said: “The business combination of FaceBank Group and fuboTV accelerates our ability to build a category defining company and supports our goal to provide consumers with a technology-driven cable TV replacement service for the whole family.

“With our growing businesses in the US, and recent beta launches in Canada and Europe, fuboTV is well-positioned to achieve its goal of becoming a world-leading live TV streaming platform for premium sports, news and entertainment content.

“In the current Covid-19 environment, stay-at-home stocks make perfect sense – we plan to accelerate our timing to uplist to a major exchange as soon as practicable.”

The boards of directors of both companies and the major stockholders of fuboTV have approved the transaction, which is anticipated to close during the first quarter of 2020, subject to the satisfaction of certain closing conditions.