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Inspired Announces Agreement To Acquire Novomatic UK’s Gaming Technology Group

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Inspired Announces Agreement To Acquire Novomatic UK's Gaming Technology GroupReading Time: 4 minutes

 

Anticipated to Diversify and Broaden Scale and Scope of Inspired’s Footprint and Product Offering

 

Inspired Entertainment, Inc. announced that it has entered into a definitive agreement to acquire the Gaming Technology Group (“NTG”) of Novomatic UK Ltd. (“Novomatic UK”), a division of NOVOMATIC GROUP, a leading international supplier of gaming equipment and solutions, for the EUR equivalent of US$120.0 million in cash.

Inspired is a leading supplier of Category B2/B3 gaming terminals in the UK, and NTG is a leading supplier of Category B3, C and D gaming terminals to pubs, arcades, motorway service areas and holiday resorts in the UK.  Following the transaction, Inspired would be positioned to supply an extensive range of products and services across the UK and Europe, and beyond.  Upon closing the acquisition, Inspired would manage more than 75,000 gaming machines in the UK and Europe.

“The potential acquisition of NTG is transformational for Inspired, enabling us to dramatically increase the size, scale and scope of our business by combining our highly complementary, but largely non-overlapping, businesses,” said Lorne Weil, Executive Chairman of Inspired Entertainment. “We expect to leverage our superior game content, technology, operational capabilities and respective footprints to augment the existing growth trends for our enterprise.”

NTG is comprised of the following six companies:

  • Gamestec Leisure – Primarily serving the UK pub sector through the placement of gaming machines on a managed service basis and delivering service support to the bingo and self service betting terminals sectors.
  • Playnation Limited Serving the UK holiday and leisure industry, including holiday parks, motorway service stations, bowling alleys, airports and independent holiday resorts through revenue share arrangements with operators.
  • Astra Games Limited – Gaming machine manufacturer, selling Category B, C and D gaming machines to pubs, adult gaming centers, and holiday resorts.
  • Bell-Fruit Group Limited – Primarily selling Category C machines, both analog and digital, and exporting machines to key European geographies.
  • Harlequin Gaming Limited – Game development studio for Astra and Bell-Fruit.
  • Innov8 Gaming Limited – Gaming machine developer supplying Category B3 and C gaming machines within the NTG and to external customers.

Mr. Weil continued, “Inspired and NTG currently operate in different segments but have much in common in terms of providing resources for our customers and their consumers.  This combination would provide additional resources for our core businesses and combine the great content and machine portfolio from each. We expect to be able to deliver meaningful value to our shareholders as the acquisition is integrated.”

Improved Operating Efficiencies

Inspired expects to achieve $12.3 million to $13.3 million of synergies through shared costs and increased scale. Inspired also expects to be able to make efficient use of shared manufacturing, engineering, software development, field maintenance and customer service to drive growth and cost savings after the transaction closes.  Inspired further expects to reduce capital deployed in the pub gaming sector following the closing of the transaction, as the sector continues its ongoing digital transformation.

Complementary Businesses Leveraging Core Competencies

Inspired plans to draw on the core strengths of Inspired and NTG to broaden offerings, bring differentiated gaming products to new sectors and geographies, accelerate key growth initiatives and offer enhanced capabilities, systems, field service and content.  The addition of NTG is expected to help diversify Inspired’s UK business and expand into contiguous customer segments with very little overlap of existing customers. Inspired’s position and expertise in server based gaming is expected to accelerate NTG’s development initiatives to transition the pub gaming sector from analog to digital gaming machines.

Inspired and NTG are both known for their product innovation and creative content. Together, the companies expect to offer an expansive combined game and machine portfolio to customers. Inspired and NTG are also well positioned to capitalize on further converting NTG’s game library for online deployment.

Transaction Terms and Execution

Inspired has agreed to acquire NTG for the EUR equivalent of US$120 million, subject to certain customary adjustments.  This consideration represents a multiple of approximately 5.5x NTG’s pre-synergy Adjusted EBITDA of £17.1 million, or $21.7 million[2], for the 12-month period ended December 31, 2018, and 3.5x after adjusting for the mid-point of estimated run-rate annual synergies of £9.6 million to £10.6 million, or $12.3 million to $13.3 million, as if they were achieved January 1, 2018.

The acquisition, which is subject to the approvals of regulatory authorities and other customary closing conditions, is expected to close during the third quarter of 2019.  In conjunction with the proposed transaction, Inspired is expected to refinance its existing indebtedness with a new £220 million GBP-equivalent term loan and £20 million revolving credit facility.  Inspired has obtained committed financing for the transaction, and the transaction is not subject to a financing contingency. The committed financing is expected to result in a reduction in cost of debt capital.

“The proposed financing is at a lower interest rate than our existing debt and is a major step in improving Inspired’s capital structure,” said Stewart Baker, Executive Vice President and Chief Financial Officer of Inspired.  “Pro forma for the acquisition, adjusting for the mid-point of estimated run-rate annual synergies, the proposed financing implies net leverage of 3.0x[3].  It will position us with a stronger balance sheet and extended maturities, while also reducing our cost of capital which we believe will allow us to have more flexibility to capitalize on meaningful opportunities to grow our business.”

Casino Operations

The casino assets of Astra Games Limited are not included in the potential transaction.  At or prior to the closing of the Acquisition, Astra will transfer to Novomatic UK Gaming UK Limited, a wholly-owned subsidiary of NOVOMATIC GROUP, assets to the extent related to its casino operations.

Financial and Legal Advisory

Nomura served as financial advisor to Inspired. Sidley Austin LLP and Addleshaw Goddard LLP served as legal advisors to Inspired.  Nomura and Macquarie Capital have provided financing commitments to support the transaction.

 

About Inspired Entertainment, Inc.:

Inspired is a global games technology company, supplying Virtual Sports, Mobile Gaming and Server Based Gaming systems with associated terminals and digital content to regulated lottery, betting and gaming operators around the world. Inspired currently operates approximately 35,000 digital gaming terminals and supplies its Virtual Sports products through more than 40,000 retail channels and over 100 websites, in approximately 35 gaming jurisdictions worldwide. Inspired employs more than 650 employees in the UK and elsewhere, developing and operating digital games and networks.

SOURCE Inspired Entertainment, Inc.


Source: European Gaming Media
This is a Syndicated News piece. Photo credits or photo sources can be found on the source article: Inspired Announces Agreement To Acquire Novomatic UK’s Gaming Technology Group

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Betting firms have responsibility to tackle esports corruption

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Gambling companies have a responsibility to stamp out corruption in esports, according to one betting industry official.

The reputation of esports has been harmed by scandals including match-fixing, cheating and underage gambling.

Recent examples include CSGO player forsaken being banned after using a hack in an ESL Premiership event and Clash Royale payer Jimit Bhatt being suspended for 12 months for cheating.

Lars Lien, founder and CEO of esports betting operator Luckbox.com, says the legitimate operators in the gambling industry have a duty to help clean up the reputation of esports.

Luckbox is a member of the Esports Integrity Coalition, which works to maintain standards in esports.

Lien said: “Gambling will happen and it’s a matter of making sure that responsible operators work together to stamp out match-fixing and to help prevent it. We have an integral role in eliminating that from our world.

“This is why we’re part of ESIC, where we and other responsible operators share suspicious alerts. So if we see betting patterns that are not consistent with a normal match, we report to ESIC and they will investigate the event in question. They work with tournament organisers, teams, they educate players, they work to stamp it out.”

 

Players need to understand the risks

Luckbox holds an Isle Of Man gambling licence, which offers esports fans the highest levels of security and protection to bet on Dota 2, CSGO and League Of Legends.

Lien said it was also important for esports fans to be aware of the risks when choosing where to bet.

He said: “Recently, there’s a Reddit post that a gaming company stole $500 from them. There might be legitimate reasons for seizing the funds of a customer, because match-fixing is a problem in every sport, including esports.

“That gambling company might have very good reasons for seizing funds but the difference is if that company had a good licence, the customer would be able to go to the Gaming Commission, file a formal complaint and the Gaming Commission would help the customer get the money back if that seizure was unwarranted. There’s legal recourse.

“Operators in jurisdictions such as Curacao, Cyprus, many others. There’s no recourse. I could borrow a Curacao licence if I wanted to.

“Esports has seen the skin-betting scandals where operators have let 12-year-olds play using their parents’ credit cards. Children don’t have the same understanding of gambling risks. Even with adults, you will have problematic behaviour.

“Betting should enhance your experience, it should not be the experience. If someone loses their house, that’s a bad thing, of course.

“This is also part of the distinction between the good guys and the bad guys. We have deposit limits, we have responsible gaming limits, we will make sure our players are over 18 and we will be looking for problematic behaviour, so we can help people not spend more on gambling than they can afford.”

 

Learning from the best

Lien said he was motivated to obtain the Isle of Man licence after working at PokerStars, which is also based on the island. In 2011, the US government banned online poker and PokerStars was able to return funds to players while rival Full Tilt collapsed.

Lien said: “You can either be one of the good guys, that has a proper licence, where all of the player funds are segregated from the funds of the company.

“We have what’s called a ‘client account’, which is similar to what a lawyer would have to keep the funds of their clients, that’s completely legally and physically separated from the funds of the business.

“I worked for PokerStars and the Department of Justice, in the US, decided they wanted to shut down the poker scene. They filed complaints against PokerStars and one of the competitors, Full Tilt. What happened?

“PokerStars, because they had taken licensing seriously from day one – they actively and intentionally got the strictest gambling licence in the world (the Isle of Man) – and as a consequence of that they were forced into having good corporate governance, good structures, good compliance. They were forced into doing things right and Full Tilt did not.

“So when the Department of Justice pulled the rug from under the industry, FullTilt collapsed. Customers couldn’t get their money, everything was black, no one understood how they would get their money back. They didn’t have the money, PokerStars did and paid everyone back in a matter of weeks.”

 Make sure to view the video where, Lars Lien, CEO of Luckbox, discusses the role of betting in the esports industry, and how proper regulation can solve the issues that it raises.

 

About Luckbox

Luckbox was founded by former PokerStars colleagues Lars Lien and Mike Stevens. Luckbox was built by a team combining vast experience in the igaming industry and a passion for esports to offer players unique and highly social platform for CSGO gambling, Dota 2 and League of Legends betting. Real Time Games Holding Limited – the company behind the Luckbox brand – holds a full licence under the Online Gambling Regulation Act (OGRA), issued by the Gaming Supervision Commission. Luckbox is a proud member of ESIC and is committed to supporting responsible gambling.


Source: European Gaming Media
This is a Syndicated News piece. Photo credits or photo sources can be found on the source article: Betting firms have responsibility to tackle esports corruption

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Incentive Games signs renowned Gamification trailblazer Yu-kai Chou to their Advisory team

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Edinburgh-based software developer Incentive Games have announced the addition of internationally renowned Gamification trailblazer Yu-kai Chou to their Advisory team. The company has long followed Yu-Kai’s work and plans to apply his considerable expertise, including his pioneering Octalysis framework, to their products.

Author of “Actionable Gamification” and a regular speaker and lecturer on Gamification and motivation, Chou has worked with the biggest and the best; improving over 1 billion user experiences working with giants like Google, Lego, Tesla, TEDx, Huawei and Turkish Airlines. One of the earliest pioneers in Gamification, Yu-Kai has been named “Gamification Guru of the Year” in 2014, 2015 and 2017 by the World Gamification Conference, a testament to his continued research and contributions to the Gamification space.

Incentive Games develop games specialized to deliver value to the iGaming industry. Whether reinvigorating stale userbases or building them from scratch, Incentive Games acquire, retain and monetize users by delivering high quality, dynamic gaming content set within a casual, social framework to make their clients’ users go further. As Incentive Games continue their expansion through the USA and African markets, Yu-kai’s expertise will be invaluable in sharpening the competitive advantage of IG’s product suite.

“We are thrilled to have Yu-Kai Chou joining the Incentive Games team, his work in gamification and behavioral design is truly best in class, we can’t wait to implement his ideas into our games going forward,” said John Gordon, CEO of Incentive Games, on the announcement.

Formerly ‘Premier Punt Group’, Incentive Games have been moving from strength to strength since completing their B2B rebrand in late 2018. Previously designing industry-specific customer acquisition and retention software, Incentive Games has diversified their offering significantly with general purpose products now applicable to any industry.

Under the guidance of Yu-Kai, Incentive Games look to further hone the user experience across all their products, driving the user acquisition, retention, and monetization value of their games and capturing more competitive market share in 2019 than ever before.

Yu-kai Chou at TEDX Lausanne – speaking about how Gamification to improve our world

 

Incentive Games will be attending iGB Live! 2019 in Amsterdam 16-19 July. If you wish to book a meeting or have a chat at the conference please email dan@incentivegames.com or visit www.incentivegames.com


Source: European Gaming Media
This is a Syndicated News piece. Photo credits or photo sources can be found on the source article: Incentive Games signs renowned Gamification trailblazer Yu-kai Chou to their Advisory team

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Scout Gaming granted betting license

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Scout Gaming Group has been granted a license by Malta Gaming Authority, which enables Scout Gaming to provide betting related services, to operators under the Maltese regulation.

Scout Gaming has been granted permission from Malta Gaming Authority (MGA) to offer its recently developed products to operators licensed under MGA. As a part of the company’s strategy to offer additional sport-related services, a bunch of new games is expected to be launched under the second half of the year.

“Our player pricing is the foundation of additional odds related products, a prerequisite for launching these in Europe has been a license. Hence, I’m happy that we now can initiate the rollout. We already have a couple of current clients showing interest in this and one of the products is now live on the Indian market, comments Scout Gaming’s CEO, Andreas Ternstrom.

For additional information, please contact:
Andreas Ternstrom, CEO, Scout Gaming
Tel: +46 706 770 660
E-mail: andreas.ternstrom@scoutgaminggroup.com

About Scout Gaming Group
Scout Gaming Group is a licensed and regulated provider of B2B Daily Fantasy Sports and pool betting. The company offers a flexible and customizable network based Fantasy Sports solution with support for most sports and leagues through an in-house StatCenter which also provides real-time information to players. Local sports can be provided on request. The Group is headquartered in Stockholm, Sweden with development and operations in Bergen, Norway and Lviv, Ukraine. Sales, support and product management is handled from the office in Malta.


Source: European Gaming Media
This is a Syndicated News piece. Photo credits or photo sources can be found on the source article: Scout Gaming granted betting license

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