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NetEnt acquires casino software provider Red Tiger

George Miller

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NetEnt launches brand new aggregation platform NetEnt Connect
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NetEnt has entered into an agreement to acquire fast-growing online slot supplier Red Tiger Gaming Limited (“Red Tiger”) in an all-cash deal with an initial enterprise value of GBP 200 million plus a possible additional amount of maximum GBP 23 million in 2022. The transaction will be completed imminently and is expected to be accretive to NetEnt’s EPS in 2020.

Established in 2014, Red Tiger is a leading online supplier of casino games and software renowned for its daily jackpot games. The company has approximately 170 employees with operations in Malta, Isle of Man and Bulgaria. Red Tiger’s earnings before interest, taxes, depreciation and amortization (EBITDA) is expected to reach GBP 18 million for the full year 2019.

The deal is in line with NetEnt’s vision to create the future of gaming. Over the last several years, the company has invested in a global infrastructure focusing on customer reach and regulated markets, supporting a platform for scale. The acquisition of Red Tiger gives NetEnt the opportunity to capitalize on its scalable technology to support future growth.

I am very pleased to welcome Red Tiger into the NetEnt Group. The acquisition combines two of the leading and most innovative companies in the online gaming industry. We look forward to working with Red Tiger’s fantastic team to enhance our combined global reach and to offer further value to operators and players. The transaction will provide significant revenue synergies across our markets worldwide,” says Therese Hillman, Group CEO of NetEnt.

Gavin Hamilton, CEO of Red Tiger, comments: “This is an exciting new stage of the Red Tiger story and we are delighted to become part of the NetEnt group. Accessing NetEnt’s unparalleled distribution network and geographic footprint will unlock new opportunities for Red Tiger and will further accelerate our growth. At Red Tiger we’ll remain focused as always on driving further innovation and we are looking forward to working with NetEnt on how to leverage our combined capabilities to create new products that wow our customers.”

NetEnt pays an initial consideration of approximately GBP 197 million for 100 percent of the shares of Red Tiger. In addition to the initial purchase consideration, a remaining amount of maximum GBP 23 million may become payable in 2022 on an earn-out basis, subject to Red Tiger’s financial performance over the coming two years. This implies a maximum enterprise value of GBP 223 million, corresponding to an enterprise value multiple of c. 12 times current year EBITDA. NetEnt’s income for the third quarter of 2019 will include approximately SEK 55 million of transaction- and financing-related costs.

The acquisition is financed primarily through new debt facilities provided by Danske Bank and Nordea.

Lazard has acted as financial advisor and Cirio Advokatbyrå has acted as legal advisor to NetEnt in connection with the transaction.

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SkyCity Shuts Down Auckland Casino as New Zealand Re-enters Lockdown

Niji Narayan

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SkyCity Shuts Down Auckland Casino as New Zealand Re-enters Lockdown
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Casino operator SkyCity Entertainment Group has once again closed down its flagship integrated resort SkyCity Auckland, after the New Zealand government revealed four new cases of community transmitted COVID-19 on Tuesday.

The cases have come as a huge shock to the country, which only 24 hours earlier had celebrated 100 days without a single new locally transmitted case of the coronavirus. Auckland has immediately been placed back on Stage 3 restrictions for three days as a precautionary measure, with the rest of New Zealand on Stage 2. Under Stage 3 lockdown, bars and many businesses will be closed, gatherings restricted to 10 people and travel in and out of Auckland mostly prohibited.

SkyCity’s casinos in Hamilton and Queenstown will remain open with social distancing measures in place.

“SkyCity is fully complying with this latest update from the New Zealand government. SkyCity is well prepared to respond quickly to these changes and is in a strong financial position to withstand the financial impacts of these temporary restrictions,” Graeme Stephens, CEO of SkyCity Entertainment, said.

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FSB Appoints Glenn Elliott as its Chief Operating Officer

Niji Narayan

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FSB Appoints Glenn Elliott as its Chief Operating Officer
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FSB, one of the fastest growing online gaming technology companies, has appointed Glenn Elliott as its chief operating officer.

Elliott will be working closely with the management team to further develop FSB’s dynamic personnel to become an even better growth partner for its clients in regulated markets around the world.

The role includes responsibility for the account management team as well as full oversight of the company’s five operational service divisions: Sports, Platform, Marketing, Retail and SaaS Hosting.

Before joining FSB, Elliott was at OpenBet where he was a senior account director for tier one operators such as Ladbrokes, PMU, Paddy Power Betfair and Singapore Pools.

“I am delighted to welcome Glenn to the team. Having someone of Glenn’s calibre is hugely valuable for the business, especially at a time when we are expanding into new markets, adding additional products and signing new partners,” Dave McDowell, CEO of FSB, said.

“It is an honour to join the FSB team and to help drive the organisation forward through the next stage of its development. The business is in incredible shape and has a talented and highly motivated team dedicated to ensuring it achieves its full potential,” Elliott said.

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EGBA Demands pan-European Consumer Rights for iGaming

Niji Narayan

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EGBA Demands pan-European Consumer Rights for iGaming
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The European Gaming and Betting Association (EGBA) has demanded for the introduction of a specific single set of consumer rights for Europe’s iGaming sector.

The European Commission (EC) will publish its new consumer strategy later this year. The EGBA wants the EC to incorporate its demand into the new strategy. It is now consulting stakeholders for developing a single pan-European set of consumer rights.

EGBA has sent a letter to EC with the following excerpts:

In its submission to the EC, it says: “The lack of regulatory consistency jeopardises online players’ safety, as it exposes them to the unregulated and unsafe websites of the black market, which profits to the detriment of the European economy.

“EGBA advocates sector-specific EU regulation for consumer and minor protection.

“There are simple rules that can be proposed, to ensure that online players, minors and players who are at risk are equally protected.

“For example, self-excluded players could benefit from a European self-exclusion register, that would prohibit access to any regulated website of the EU.

“To bridge the gap stemming from inconsistent rules on protecting minors from gambling marketing, EGBA has recently published a European code of conduct to establish minimum requirements on responsible advertising.

“Greater regulatory cooperation between member states can also facilitate the dialogue to achieve harmonisation.

“To this end EGBA regrets the dissolvement of the European expert group for online gambling, as national gambling regulators are deprived from the opportunity to meet and exchange in the framework of a common platform.”

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