In what would be a major consolidation of B2B casino game developers and suppliers, Australian gaming giant Aristocrat Leisure has announced a cash offer to acquire Playtech, in a deal with an enterprise value of $3.7 billion.
The proposed acquisition has an ordinary share value of $2.9 billion on a fully diluted basis.
The acquisition comes in the wake of Playtech partnering with Unibet Interactive, part of the Kindred Group, to enter US markets earlier this month.
The all-cash transactions should be funded by the issuance of $1.1 billion in new shares, plus existing cash and new debt. Playtech’s board has recommended that all shareholders vote for the transaction, but the voting will only happen at the next general meeting. At least 75% of the shareholders will have to support the deal for it to be completed.
Playtech CEO Mor Weizer said the offer “marks an exciting opportunity in the next stage of growth for Playtech and delivers significant benefits to our stakeholders, including our customers, our shareholders and our incredibly talented people.
“This deal has the potential to enhance our distribution, our capacity to build new and deeper relationships with partners, and bolsters our technological capabilities.”
A merger of giants
Both Aristocrat and Playtech are already huge names in the iGaming industry, and this merger would allow them to capitalize on all their resources and drive even more traffic and revenue to their products.
“The combination of our two companies builds one of the largest B2B gaming platforms in the world, with the people, infrastructure and expertise to provide our customers with a truly best-in-class offer across all areas of gaming and sports betting,” Wiezer said.
Aristocrat looks to enter US markets
The merger would also mean more access to previously closed markets for Aristocrat, which would now have direct access to US markets that Playtech is currently active in.
Earlier in October, Playtech entered a deal with Unibet Interactive to provide their unique casino software for use in New Jersey and other states in the future.
“The combined group would offer a broad portfolio of end-to-end solutions for gaming customers around the world, as well as seamless player experiences, underpinned by a shared focus on responsible gameplay and innovation,” said Aristocrat CEO Trevor Croker.
“Additionally, the business will be ideally positioned to unlock sustainable shareholder value by seizing opportunities in the fast-growing global online RMG segment as they continue to open up, particularly in North America.”
North America has been the biggest driver of Playtech’s growth, which has seen the company’s revenue increase 106% in H1 of 2021.
Playtech entered the Michigan market through a partnership with Parx Casino and has been approved by regulators in several other US states. It also delivers products to South American nations such as Colombia, Panama and Costa Rica.
Another subsidiary, Playtech’s Snaitech division, has been successful in the Italian market. Acquiring Snaitech would give a boost to Aristocrat, which is also active in the European market. A merger would enable Aristocrat to reach a wider range of customers with Playtech’s products and services.
