Raketech announces sale of US tipster brand following strategic review
The $2.25m sale of ATS Consultants will allow the affiliate to focus on its core assets as it looks to “maximise growth opportunities” less than three years after acquiring group for $15.5m
Raketech has announced the sale of its non-core, US-based advisory firm ATS Consultants in a $2.25m (£1.8m) deal.
The Malta-based affiliate will sell ATS to the brand’s existing management, with the deal expected to be completed by 31 August 2024.
The sale will be settled partially on closing and via an ongoing revenue share agreement, and will also result in a one-off non-cash impairment charge of approximately €10m for the US assets.
Raketech has also signed an exclusive lead generation agreement guaranteeing a minimum fee of $250,000 over the next 12 months.
The sale comes after the affiliate conducted a strategic review into its US operations in Q2 2024.
The review found ATS, a network of lead generating sports tipster sites, to be underperforming at a time when Raketech had identified opportunities for affiliate growth in the US market.
This included increased traffic, significantly improved sales of subscriptions to multi-capper picks and predictions (MCP) services, as well as higher affiliation marketing revenue from US sportsbook operators.
The review also established that “the underperforming high-touch advisory operations” were “ increasingly non-core and subscale”.
The affiliate added the sports tipster sites were “highly dependent on a manual lead conversion sales team”.
ATS had generated revenue for the 12 months to 31 March 2024 of $4m while EBITDA contribution was “minimal”, according to Raketech management.
Raketech acquired the brand for $15.5m in November 2021, representing a 6x EBITDA for the business. At the time, Raketech paid $12m upfront in cash for the brand.
Moving forward, Raketech will continue to use its other US brands Winners and Whiners, Statsalt and Picks and Parlays.
Raketech CEO Johan Svensson said: “This strategic sale is an important step in streamlining our operations and focusing on our core strengths.
“By leveraging our high-quality US operations, our strategy is to maximise the growth potential in digitalised subscription and affiliate marketing revenues and expand our sub-affiliate marketing and partnership revenue streams.
“Despite the one-off non-cash impairment charge, we are confident that this move will enhance our focus, drive improved performance and deliver long-term sustainable growth and value creation,” he added.
Svensson was named Raketech’s permanent CEO in May this year following a five-month stint in an interim capacity after former chief Oskar Mühlbach’s departure in January 2024.