Brera Holdings PLC (NASDAQ:BREA) shares are trading higher on Tuesday after the company disclosed the details of a three-step acquisition process for a majority equity ownership interest in Italian Serie B football club SS Juve Stabia SpA.
This acquisition is a key step in expanding Brera's multi-club ownership (MCO) model, aiming to drive operational synergies and long-term growth.
Notably, on December 9, 2024, Brera disclosed the signing of a binding term sheet for its acquisition of Juve Stabia, a historic Serie B football club in Naples.
Brera has agreed to acquire a majority stake in Juve Stabia through a three-step process involving share capital and reserve increases.
Brera will make cash payments and issue BREA shares, gradually increasing its ownership to 22%, 38%, and approximately 52%.
Upon completion, Brera will become the majority shareholder, and a Shareholder Agreement with current owner Andrea Langella will integrate Juve Stabia into Brera's multi-club framework.
The first step, giving Brera 22% ownership, is expected to conclude by December 31, 2024.
The agreement includes performance-based compensation for Mr. Langella, tied to milestones like qualifying for Serie B playoffs and promotion to Serie A, aligning Brera's interests with Juve Stabia's success.
The final step, granting Brera 52% ownership, is scheduled for March 31, 2025, at which point Brera will take controlling ownership and begin integrating the club, with plans for an IFRS audit under PCAOB guidelines for SEC disclosure filings.
Notably, Juve Stabia recently secured a 1-0 victory over Cesena FC and currently ranks fourth in the Serie B standings, just two points ahead of fifth-placed US Cremonese.
The top three Serie B teams earn promotion to Serie A, with the top two qualifying automatically and the third via a playoff.
Daniel McClory, Executive Chairman of Brera Holdings, said, "We are excited to partner with local management and invest in this historic team to capitalize on player trading opportunities, potentially secure a position in the Serie B playoffs, and ultimately pursue promotion to Serie A, all of which would augment Club revenue and unlock further value for our investors."
Price Action: BREA shares closed higher by 42.80% to $1.00 on Tuesday
