Australian slot machine giant Aristocrat has launched an AU$3.9 billion (US$2.9 billion) bid to acquire online gaming platform provider Playtech plc.
According to a Monday filing, Aristocrat has already received letters of intent or irrevocable undertakings from Playtech shareholders representing 20.7% of the company’s outstanding shares, with the Playtech board having also unanimously recommended remaining shareholders vote in favor of the scheme.
Under the terms of the deal, Aristocrat is offering a cash price of 680 pence per share, representing a 58% premium over the Playtech closing price of 429 pence on Friday 15 October 2021.
The global slot machine supplier said the acquisition of Playtech would accelerate Aristocrat’s growth strategy and deliver strategic benefits, including providing it with “material scale” in the US$70 billion online RMG (real money gaming) segment, delivering medium-term revenue and earnings growth, enabling it to meet a broader range of customer and player needs, and to operate and innovate in multiple European markets “across the entire value chain and free of channel conflict.”
Aristocrat CEO and Managing Director Trevor Croker said, “The proposed combination would bring together Aristocrat’s world-class gaming content and customer and regulatory relationships with Playtech’s industry-leading global online RMG platform and European B2C footprint.
“The combined group would offer a broad portfolio of end-to-end solutions for gaming customers around the world as well as seamless player experiences, underpinned by a shared focus on responsible gameplay and innovation.
“Additionally, the business will be ideally positioned to unlock sustainable shareholder value by seizing opportunities in the fast-growing online RMG segment as they continue to open up, particularly in North America.
“Adding Playtech’s talented team with Aristocrat’s established strengths and momentum will create a true industry leader in the global online RMG space, particularly in terms of our B2B capabilities.”
Aristocrat said it plans to fund the acquisition by way of AU$1.1 billion (US$816 million) in existing cash, a US$2.05 billion term loan and AU$1.3 billion (US$965 million) in equity raising by way of an entitlement offer, to be launched this week.
Trading in Aristocrat shares was halted Monday morning.