The Glimpse Group, an enterprise-level augmented reality and virtual reality (AR/VR) platform provider, entered into a definitive agreement to acquire Sector 5 Digital (S5D), an immersive technology company, for a potential purchase price of USD 27 million in a combination of cash and stock. 

The acquisition, which is ~30% equity-based, will potentially offer future equity-only performance payments subject to S5D achieving significant B2B revenue growth milestones.

The acquisition will strengthen Glimpse’s financial and operational performance, expand its team, scale its product offering, and create synergies. Additionally, Jeff Meisner, general manager of S5D, will serve as Glimpse’s chief revenue officer and join its board of directors.

Founded in 2014, S5D offers digital marketing through immersive technology for organizations. Its proprietary platform features VR, AR, 3D modeling and animation, film and video production, and interactive game technology. Its customers include American Airlines, BAE Systems, Bell Flight, Ecolab, Galderma, Halliburton, Recaro, and Textron Systems.

S5D also expects to report revenue growth of ~33% YoY to more than USD 4 million for FY2021 (compared with USD 3 million in FY2020). The company is expected to report a gross margin of 55%–60% and generate a positive cash flow from operations.