NeoGames looks to acquire Aspire Global in $480m cash-plus-shares deal
Nasdaq-listed online lottery supplier eyes global gains with offer for B2B platform supplier
NeoGames has agreed a cash-plus-shares deal to acquire B2B platform provider Aspire Global for $480m (£352m).
Under the terms of the multi-million-dollar agreement, NeoGames will acquire 100% of Aspire Global through a 50% cash purchase at a price of SEK 111 (£8.98) per share, an estimated value of $293m (£214.8m).
The remaining 50% consideration will be paid via 7.6 million newly issued shares in NeoGames, calculated at an exchange ratio of 0.32 shares in NeoGames for every one share in Malta-based Aspire Global.
NeoGames has confirmed it has taken a loan of more than $215m (£157.6m) and an extended overdraft facility of $15m from US-based bank Blackstone Alternative Credit Advisors LP.
Aspire Global shareholders owning 67% equity in the business have accepted the offer to receive up to 100% of the newly issued NeoGames shares, a transaction which allows remaining shareholders to receive cash payments in lieu of shares.
“A committee of independent Aspire Global directors has unanimously recommended to Aspire shareholders to accept the offer and to elect to receive full cash consideration,” NeoGames said.
NeoGames has said Aspire’s management teams have a “strong cultural fit” having worked with the B2B platform supplier on previous occasions.
It has been suggested the combined group will be split into two separate divisions, one iLottery, which will contain the bulk of the NeoGames business and an igaming division, which will include all Aspire’s current operations and employees.
The combined group will continue to be led by NeoGames CEO Moti Malul and CFO Raviv Adler, with the firm’s current board of directors expected to remain unchanged. Aspire Global CEO Tsachi Maimon is expected to join NeoGames as president and lead its newly formed igaming division.
Aspire Global’s customer base outside of the US, as well as the utilisation of these assets in the emerging markets of Africa and Latin America have been cited as a potential area of diversification for NeoGames.
The ability to provide an end-to-end solution for customers and an increased commitment to growth through expansion of the combined group’s total addressable market (TAM) were also highlighted as rationales for the deal by NeoGames CEO Moti Malul.
“As we have shared previously, we embarked on a process to identify external growth opportunities in areas we thought could solidify our standing as a leader in providing digital solutions to lotteries globally,” Malul said.
“As more and more lotteries globally converge into additional gaming verticals such as online sports betting and iGaming operations, the ability to provide a wide range of products, combined with experience in their operations, is becoming increasingly important.
“We are confident this transaction will grow shareholder value and we consider the more than 30% accretion in the nine-month historical pro forma combined adjusted earnings before taxes a good first financial indicator of the potential of a combination,” continued Malul.
NeoGames has confirmed its formal offer document will be published on April 4, with the expected completion date to be on or about May 17.
NeoGames was advised by Stifel from a financial perspective and legal firms Latham & Watkins LLP, Herzog Fox & Neeman, Hannes Snellman Attorneys Ltd and Allen & Overy LLP.
Aspire Global retained Oakvale Capital as its financial advisor and Baker McKenzie as its legal advisor for the transaction.