Acquisition of Coolbet’s best-in-class
international sportsbook engine provides GAN with a full-service
solution to real money gaming in U.S.
Combination brings additional scale,
geographical reach and offers new market opportunities for GAN’s
B2B technology and a new vertical through B2C
GAN Limited (the “Company” or “GAN”) (NASDAQ: GAN), a leading
business-to-business supplier of internet gaming
software-as-a-service solutions primarily to the U.S. land-based
casino industry, today announced that it has signed a definitive
purchase agreement to acquire Vincent Group p.l.c. (“Coolbet”) for
a total consideration of approximately €149 million (subject to
adjustment as provided in the Share Exchange Agreement). The
acquisition is expected to close in the first quarter of 2021,
subject to regulatory review and the satisfaction of certain
closing conditions. GAN expects to fund the acquisition with new
capital. Coolbet is an award-winning, Business-to-Consumer (“B2C”)
iGaming operator, with a footprint in Northern Europe, Canada, and
Latin America in real money iGaming and online sports betting.
Acquisition Highlights:
- Vincent Group p.l.c. brings Coolbet, a sports focused brand to
GAN, which was founded by the industry veteran Jan Svendsen and is
supported by proprietary software with one of the most experienced
engineering and trading teams in the industry.
- Coolbet achieved trailing-twelve-month revenue of €26 million
and a 46% revenue CAGR from 2018 to 2020, making it one of the
fastest growing European B2C iGaming operators today.
- The acquisition will leverage Coolbet’s industry-leading,
proprietary sports betting technology, which is anticipated to be
integrated into GAN’s turnkey technology solutions for launch in
the U.S. RMiG market by second half of 2021.
- Provides additional opportunity to leverage GAN’s
business-to-business (“B2B”) experience and proprietary technology
into Coolbet’s core markets and across its existing relationships
with casino operators around the globe.
- GAN to welcome over 175 new global employees and engineering
talent, over 84,000 active customers in the third quarter of 2020,
and an industry leading retention rate of 85% Quarter-on-Quarter in
2020.
- Transaction is expected to close in the first quarter of 2021
and will be immediately accretive.
Dermot Smurfit Commented:
“From the onset of our IPO we have continued to enhance and
perfect our internet gaming software-as-a-service solutions for the
U.S. market. As a part of that growth strategy, we have been clear
that we needed to add a best-in-class sportsbook engine to round
out our real money iGaming platform, and we believe Coolbet is the
perfect fit for both GAN and our customers. Coolbet launched in
early 2016 in a hypercompetitive online market in Northern Europe
and subsequently expanded into Latin America and Canada over the
last two years. Since its launch, Coolbet has proven that its
sportsbook offering is one of the best in the market today.
Coolbet’s award winning user interface and proprietary technical
platform will enable us to quickly introduce the sportsbook
offering to our land-based casino customers across the U.S., who
need a flexible and customizable solution to online gaming. Coolbet
brings one of the most experienced teams of engineers in the
industry and their technology is built on a similar architectural
design as our own, which is anticipated to make the integration
process fairly seamless. The timing of the acquisition ideally
positions GAN to leverage its growing customer base, as well as the
momentum that sports legislation has seen with the election results
in Maryland, Louisiana, South Dakota, and Tennessee.”
“Additionally, Coolbet is more than just the best sportsbook
platform we vetted during our process. Coolbet has a
well-established global business, a strong and loyal B2C customer
base, and a diversified revenue stream. They are expert marketers
and have grown their top-line over 46% in highly competitive and
established markets in Northern Europe, Latin American and Canada.
We will not only achieve scale and diversity across our revenue
streams through this combination, but we also see a strong
opportunity to leverage Coolbet’s expertise and relationships in
other markets where our industry-leading B2B SaaS platform can be
deployed.”
“In summary, this union brings two of the best-in class,
high-growth offerings in the iGaming space together, and makes a
powerful combination. We expect to achieve significant revenue
synergies across both platforms over the long-term and have
structured the deal to be immediately accretive. We are excited to
welcome the Coolbet team to GAN and look forward to building one of
the most complete solutions in our industry. We view this
acquisition as part of our unwavering commitment to shareholder
value and our long-term growth strategy.”
Coolbet Background
Vincent Group p.l.c. is a Malta public limited company that
operates an online gaming platform under the flagship brand,
Coolbet. Coolbet’s proprietary platform was uniquely developed
in-house, and offers online real-money gaming in sports, casino,
poker and virtual e-sports. Coolbet currently has approximately 175
full-time equivalents, primarily based in Tallinn, Estonia, and a
management team with extensive experience in the RMiG industry.
Currently, the Company has gambling licenses in Estonia, Sweden and
Malta.
Coolbet was awarded start-up of the year in 2017 by
International Gaming Awards, World’s Best Bookmaker in 2018 and
2019 by TIPS magazine, and mobile sports product of the year in
2019 and 2020 by the International Gaming Awards.
Revenue for the first nine months of 2020 was €18.6 million,
split approximately 50% in sports betting and 50% in casino and
other. Coolbet has customers in Norway, Sweden, Finland, Iceland,
Estonia, Chile and recently expanded into Canada and Peru. Despite
the impact of COVID-19 on its markets in the second quarter of
2020, the Company has achieved an EBITDA of €0.5M for the nine
months ended September 30, 2020 and break-even Net Operating
Income. Coolbet has previously raised €35 million in equity through
private placements and currently has no debt.
Transaction Summary
GAN is acquiring Vincent Group p.l.c in an exchange offer for
€149.1 million, on a cash-free, debt-free basis, through a
combination of cash and stock. The transaction, which has been
unanimously approved by GAN Limited’s board of directors, is
expected to close in the first quarter of 2021. It is subject to
customary closing conditions, including regulatory approvals.
B. Riley Securities provided a fairness opinion to the GAN board
of directors with respect to the acquisition, and Sheppard, Mullin,
Richter & Hampton LLP, is acting as GAN’s legal counsel.
About GAN Limited
GAN is a leading business-to-business supplier of internet
gambling software-as-a-service solutions predominantly to the U.S.
land-based casino industry. GAN has developed a proprietary
internet gambling enterprise software system, GameSTACK™, which it
licenses to land-based casino operators as a turnkey technology
solution for regulated real-money internet gambling, encompassing
internet gaming, internet sports gaming and virtual Simulated
Gaming.
Forward-Looking Statements
This release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
All statements contained in this release that do not relate to
matters of historical fact should be considered forward-looking
statements, including, without limitation, statements regarding the
pending acquisition of Coolbet and the anticipated benefits to the
Company related thereto (including the Company’s expectation that
the acquisition will be immediately accretive with significant
revenue synergies), the timing of closing the Coolbet acquisition,
the momentum of U.S. states legalizing online sports betting, and
the ability to grow Coolbet’s B2C business and revenue, as well as
statements that include the words “expect,” “intend,” “plan,”
“believe,” “project,” “forecast,” “estimate,” “may,” “should,”
“anticipate” and similar statements of a future or forward-looking
nature. These forward-looking statements are based on management’s
current expectations. These statements are neither promises nor
guarantees, but involve known and unknown risks, uncertainties and
other important factors that may cause actual results, performance
or achievements to be materially different from any future results,
performance or achievements expressed or implied by the
forward-looking statements. Readers are cautioned not to place
undue reliance on any forward-looking statements, which speak only
as of the date on which they are made. The Company undertakes no
obligation to update or revise any forward-looking statements for
any reason, except as required by law.
SMRH:4814-1456-8146.2
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version on businesswire.com: https://www.businesswire.com/news/home/20201116005989/en/
Investor Contacts: GAN Jack Wielebinski Head of
Investor Relations (214) 799-4660 jwielebinski@GAN.com
Alpha IR Group Sofia Byrne or Chris Hodges (312) 445-2870
GAN@alpha-ir.com
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