Unibet Acquires iGame For a Minimum of €59 Million
Unibet Group plc signed an agreement last Friday to acquire 100 percent shares of iGame Holding plc and its subsidiaries for a minimum of €59 million.
The iGame Group specializes in online casino, poker, and sports betting offerings with a main focus in Scandinavia countries. BusinessWire reports that as of the second quarter of 2015, the number iGame's quarterly active customers was approximately 75,000, while in the six-month period to June 30, 2015, the group's Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) was €4.7 million.
The future EBITDA of the company will determine the ultimate acquisition price. According to the agreement, €59 million is fully payable in cash once completed, and up to another €20 million could be paid depending on how much EBITDA is earned by June 30, 2016.
The transaction is scheduled to complete in the later part of the third quarter of 2015 after the acquisition receives regulatory approval.
Unibet CEO Henrik Tjärnström shared with the media some of the synergies the acquisition will provide to Unibet.
"The iGame brands are well known in their local markets and we see a lot of potential by combining our bigger scale, mobile, cross-channel and product expertise with their local focus," said Tjärnström. "As the majority of the iGame revenues comes from casino, our joint plan is to keep a number of these brands as a complement to our existing brands, Unibet and Maria."
Unibet is expected to retain the current management team of iGame including the group's CEO Tommi Maijala, who was elated by what the transaction could mean for iGame players.
"We are very happy to be joining the Unibet Group," Maijala said to the media. "While Unibet is larger than iGame, we share the same passion for serving our customers and improving the operations every day. I have great comfort and trust in the long-term strategy of Unibet and highly respect all the valuable work Unibet has done for the gaming industry. Through this deal our customers will quickly see the benefits from our ability to improve the product offering. Our ability to accelerate the growth and development of the business will also provide new opportunities for our great team."
The acquisition of iGame comes on the heals of the "Interim Report January - June 2015" released on August 5. In that report, Unibet listed £1.9 million in poker related revenues, marking a substantial increase when compared to the £1.7 realized in Q2 of 2014. Additionally, Unibet reported an all-time group revenue high across all its offerings of £80.5 million.
"The success of the marketing investments made in previous quarters, has also driven organic growth of more than 21% in gross winnings revenue in constant currencies, despite tough comparables from the successful World Cup in 2014," said Tjärnström. "This has also resulted in all-time high in gross winnings revenue."
The purchase of iGame is Unibet's second major transaction in the third quarter of 2015. Unibet also acquired one-time rival Stan James Online for £19 million in July 2015. According to eGaming Review, the acquisition comprised of Stan James' online operations, but not the company's land-based shops.