G-Loot, previously valued at 1.8 billion as an e-sports company, goes bankrupt.

Swedish e-sports company G-Loot raised significant sums of money from big investors like Swedbank Robur three years ago. Despite this, the company never really managed to get its business off the ground and has struggled with high losses. Now, the owners have made the difficult decision to declare bankruptcy.

“We have done absolutely everything we can to find a solution,” says CEO Johan Persson.

Unfortunately, the business idea turned out to be unsustainable. In early 2023, the platform was relaunched under the new brand. Struggle. The biggest difference was that users were no longer competing for real money but rather glory or prizes inside the games.

Now, barely a year later, Struggle its end. The owners have made the decision to put the company into liquidation. bankruptcy, and this is confirmed by CEO Johan Persson.

“It is of course difficult. We had to face reality; the market is not there in the same way, and investor risk appetite is at record lows. We have done everything we can to find a solution, but now the board saw that there was no way to create more shareholder value by continuing to invest, so they decided to pull the plug,” he says.

The company has had virtually zero revenue, and during the first three quarters This year, operating losses totaled SEK 62.3 million. At the end of September, only SEK 23 million remained in cash.

In June, the owners of G-Loot decided to investigate the possibility of raising external financing from new investors or selling the entire company. Johan Persson says that the company has worked with UBS in this process, but unfortunately it did not lead to any success.

“We have presented the case to over 100 financial and strategic investors and buyers. We came a long way with some, and we have always felt that it was close. But this week we received a no in a lengthy process, which led to the board making this decision.”

Formally, it is the subsidiary Stryda AB which is now no longer financed by the owners and is going bankrupt, while the parent company G-Loot Global Esports AB, which currently has no actual operations, will continue to exist.

“The platform and the approximately 45 employees are located in the subsidiary,” explains Johan Persson, expressing his appreciation for “all the hard work the employees have put in.”

When bankruptcy is formally initiated, a bankruptcy trustee will try to realize as much value as possible, for example by selling Stryda's assets. This could potentially act as a relief for the owners of the parent company.

“We have a technically advanced and well-functioning platform, as well as a significant user base. I believe there is great value in the company, but at the same time there must be a buyer on the other side who can realize it,” says Johan Persson.

At the time of the bankruptcy, G-Loot only had two board members. Chairman Jonas Eriksson, who also holds the same role at the First North-listed game developer Mag Interactive, and board member Håkan Jerner, who is commercial manager in the Nordics at the gaming company Betsson.