Online gambling software company, Playtech have made a deal to buy Quickspin AB. Playtech has been providing software to casinos, bingo, sports betting, dealer games, sports related betting and poker rooms since 1999. The company is listed in LSE and is a member of the FTSE 250 list. Having started its operations as a small time design player, it has become one of the largest player online gambling software space. Quickspin on the other hand is a Swedish slot maker known for their video slots. The company has close to 20 high quality slots and close to 40 customers in their portfolio. Quickspin has some tier 1 companies as their major clients.
In a media statement released a couple of days back Playtech declared that it has made consensus with the board to acquire Quickspin in an all cash deal of € 24 Million. This cash would be paid up front. A further payment of up to a maximum of € 26 Million would be paid to Quickspin. This is based on the earning of Quickspin’s 2018 earning. According to the deal, Playtech has agreed to them 6 times of their 2018’s earning. This is considered to be a healthy acquisition since Quickspin made revenue of € 2.1 Million in the year 2015.
The founders of Quickspin have agreed to stay on board for three years after the merger. At present the company is headed by Daniel Lindberg, Joachim Timmermans and Mats Westerlund. They serve as CEO, CPO and CCO respectively. This is a wise move since companies often see an organizational turmoil after a merger. The founders would be able to streamline the ship and address any concern that employees might have.
Mor Weizer, CEO, Playtech expressed his delight and said that the process of Quickspin acquisition was going on for a long time and this deal will help them in expanding quickly in the Nordic market. Playtech has plans to penetrate a large section of the B2B market in Norway and surrounding countries. This could prove to be very strategic investment from the company.
Playtech is on acquisition mode for the past few years. Since it is sitting on a very good cash reserve, it is looking out for companies which fit well in its current scheme of things. The company wanted to acquire its rival, OpenBet Group sometime back but failed in the bid. NYX Gaming group acquired it with the help of Sky Betting and William Hill. The deal was closed at a staggering 270 Million in the form of equity. This being said, the company also had to pay the market debt of OpenBet which is estimated to be somewhere in the range of 95 Million. With this deal NYX got access to OpenBets offices in 14 countries and 1400 talented stuffs.
However, Playtech has indicated that it will keep looking for such companies to acquire in the near future. With a very healthy cash reserve the company is considering to return some of it to its shareholder in the form of dividends.