GAN has announced a definitive merger agreement to be acquired by Sega Sammy Creation, a subsidiary of entertainment and resorts business Sega Sammy Holdings.
Subject to the approval of GAN shareholders who will gather ‘no later than March 31, 2024,’ to vote on the acquisition. Each of GAN’s issued shares will be converted into the right to receive cash at $1.97 per share.
This figure will see the acquisition valued at $107.6m, and is equivalent to a premium of 121 per cent over the closing price of GAN shares on November 7.
Seamus McGill, Chairman and Interim Chief Executive Officer of GAN, commented: “After a thoughtful review of value creation opportunities available to us, we are pleased to have reached this agreement with SSC.
“Market share concentration in the US B2C space, a slower than expected adoption of regulated online gaming in the US, along with changes to key customer contracts make the near-term operating environment challenging without ample capital resources.
“Sega Sammy has those resources and GAN is a strategic complement to their existing gaming portfolio. We believe this all-cash offer, at a substantial premium to recent trading prices, is the value-maximising path for our shareholders.”
GAN’s board of directors assembled a special committee to consider the transaction and negotiate the price per shares and the remaining terms of the merger agreement, composed solely of independent directors.
While the merger is not subject to a financing condition, it will be subject to the accuracy of representations and warranties, performance of the covenants and other agreements included in the merger agreement, as well as customary closing conditions for a transaction of this type, which includes notification or approval with various gaming regulatory authorities.
Following the expected satisfaction of those conditions, and the eventual shareholder meeting, GAN plans for the merger to be closed in around a year’s time, during Q4 2024.
