Gaming Innovation Group has provided an update on its divestment agreement with Betsson Group, entered earlier in the year, stating that completion is to be finalised by the midway point of this month.
The share purchase agreement, which has been formally approved by antitrust regulators, was initially inked on February 14, with Betsson paying €33m on closing, including €2m for the cash deposit securing GiG’s Spanish casino license.
When previously disclosing details of the transaction it was said that the package alongside the online betting and gaming firm consisted of a €22.3m cash payment plus a prepaid platform fee €8.7m, and includes operator brands Rizk, Guts, Kaboo and Thrills
GiG will use part of these proceeds to repay the company’s SEK 300 million 2017 – 2020 bond, which the company asserts will strengthen the balance sheet and reduce its financial leverage ratio.
The sale of the B2C vertical comes as a direct result of GiG’s strategic review to reduce complexity and improve efficiency.
Via the divestment the B2C vertical, GiG is striving to free up resources to enable full dedication on driving and growing its B2B business, securing stable and sustainable earnings and profit margins.
Under the terms of the deal Betsson is committed to keeping the brands operational on the GiG platform for a minimum term of 24 months, with the firm paying a premium platform fee based on NGR generated.
Richard Brown, CEO of GiG, previously commented on the transaction: “I am very excited about this transaction as it provides multiple upsides to GiG. While putting the company in a financially sustainable position, it gives us the ability to focus on where we see real long term shareholder value. This transaction serves as a strategic focusing of the company’s efforts towards the B2B segment.
“Offering both B2C and B2B services had synergies in the past, however, the current conflicting priorities of the two business areas, and increased complexity in the market, have lessened the potential offering on both fronts and our ability to sign new customers.”