Novibet to go public with $625m SPAC merger

Novibet is set to become a publicly listed company after agreeing a $625m SPAC merger with Artemis Strategic Investment Corporation.

The merger will see Artemis become a wholly-owned subsidiary of Novibet, with the operator set to action on its global expansion roadmap following the conclusion of the deal.

Novibet said following the merger it would look to pursue a three-pronged approach to encouraging future growth.

The first part of this strategy is to expand Novibet’s presence in its European “heartlands”, i.e. those jurisdictions in which it has operations. The firm currently operates in Greece, Ireland, Italy and Malta.

Novibet noted European markets represent an estimated $29bn regional TAM by 2026, with plans to expand into Sweden, the Netherlands, Romania, Belgium, Hungary, Germany, France and Spain having been devised, either via a joint venture style approach in partnership with another business or through M&A.

Secondly, the Malta-headquartered operator said it would tackle market expansion across North America and Latam.

The operator has entered into a market-access agreement for igaming in Pennsylvania and is in the process of finalising market-access deals for a further six US states.

In addition, Novibet said it would also seek a direct licence to operate in Ontario and other Canadian provinces as they regulate.

In terms of Latam, Novibet said it was close to securing a market-access agreement in Mexico via a land-based operator while there are plans to enter Peru, Chile, Brazil, Colombia and Argentina in the future.

Finally, Novibet said it was also reviewing “several pipeline targets in key new regulated markets” in terms of M&A so that the operator can improve its scale, acquire local licences and provide tech synergies.

The operator noted it had approximately $135m of expected unrestricted cash to use in its M&A efforts.

Novibet revealed its expectation this multi-pronged approach and execution of strategies would drive its full-year 2023 net gaming revenue to $200m and EBITDA to $37m.

The firm noted that over the last four years it had grown gross gaming revenue at a compound annual rate of approximately 107% for the full-year 2021, with EBITDA increasing at a compound annual rate of approximately 182%.

The operator said 68% of 2021 net gaming revenue was derived from igaming, with the remainder from its sports betting operations.

Novibet also pointed towards its improved retention rate in Greece after 12 months from first deposit of 37% in 2021 compared to 11.5% pre-2019.

In terms of personnel, Novibet owner Rodolfo Odoni will be named chair of the new company while CEO George Athanasopoulos will retain his current position.

Additionally, Artemis will appoint two representatives to the Novibet board.

Speaking about the deal, Athanasopoulos said: “Our proposed combination with Artemis will enable us to both accelerate growth in our existing markets and efficiently enter newer markets.

“We see a significant growth opportunity in North America as our planned launch of operations in the US, Canada and Mexico will significantly grow our TAM with our expected initial market-access agreements for seven states enabling us to reach 14% of the US population,” he added.

Holly Gagnon, Artemis co-CEO, said: “Novibet has a strong record of success developing a superior technical platform to address the global igaming opportunity in a manner that delivers profitable financial performance and positive cash flow.

“This record, combined with its demonstrated ability to successfully and profitably enter new markets as well as the significant opportunity to leverage its competitive advantages in new markets, including in North America, aligns with our original investment thesis and makes Novibet an ideal partner for Artemis,” she added.

Following the close of the transaction, Artemis founders and existing Novibet stakeholders will hold around 75% of the combined company.

Novibet’s shareholders will roll at least 92% of their equity into ordinary shares of the combined business.

Earlier this year, Novibet surrendered its UK licence as part of its overall strategy to expand globally.

The transaction is expected to close in H2 2022 subject to approval by Artemis’ shareholders and standard closing conditions.

The boards of both Novibet and Artemis have both approved the deal.