GiG divests B2C vertical to Betsson for a total of EUR31m.
NORDIC BUSINESS REPORT-February 17, 2020-GiG divests B2C vertical to Betsson for a total of EUR31m
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Gaming Innovation Group Inc (GiG) (Oslo:GIG) (STO:GIGSEK), a technology company providing solutions, products and services throughout the entire value chain in the iGaming industry, announced on Friday the signing of a Share Purchase Agreement (SPA) with Betsson AB (STO:BETSB), a large online gambling company in Europe, for the divestment of GiG's B2C assets, which include the operator brands Rizk, Guts, Kaboo and Thrills.
Through this agreement, Betsson will become a long term partner of GiG, generating revenues to GiG's Platform Services. On the day of closing of the deal, Betsson will pay EUR31m, consisting of a EUR22.3m cash payment for the acquisition, plus a prepaid platform fee of EUR8.7m.
According to GiG, it will use the proceeds to repay the company's SEK300m 2017 - 2020 bond.
Also, Betsson has committed to keep the brands operational on GiG's platform for a minimum of 30 months. For the first 24 months, Betsson will pay a premium platform fee based on NGR generated. Based on the expected platform fees, the total value of the transaction is estimated at approximately EUR50m.
GiG added that the sale of the B2C vertical is a result of its strategic review, initiated in November 2019, leading to an evolved strategic direction to reduce complexity and improve efficiency. By divesting the B2C vertical, GiG will free up resources, enabling full dedication on driving and growing its B2B business, securing stable and sustainable earnings and profit margins. GiG sees a large and sustainable addressable market for its platform business as the regulation of the iGaming industry continues and is well positioned with the omni-channel platform offering to capitalise on the continued digital transformation of the worldwide gambling market.
In addition, GiG has, as part of the strategic review, taken a decision to make its technical platform sportsbook agnostic, and partner with other sport book providers to offer the best solutions to its customers. Betsson's sportsbook solution is intended to be integrated on GiG's platform-offering. Both GiG and Betsson will gain strategic advantage in having the possibility to sell their respective B2B solutions in an...
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