Stockholm-listed casino supplier NetEnt has agreed a £200m+ deal to acquire award-winning casino games developer Red Tiger.

The all-cash transaction will see NetEnt pay an initial consideration of £197m for the business, with an additional £23m becoming payable in 2022 if certain conditions are met.

The maximum price of £220m payable by NetEnt represents a 12x multiple of Red Tiger’s current year EBITDA, and NetEnt expects to book transaction and financing-related costs of SEK55m (approx. £4.6m) in the third quarter.

“I am very pleased to welcome Red Tiger into the NetEnt Group,” said chief executive Therese Hillman. “The acquisition combines two of the leading and most innovative companies in the online gaming industry. We look forward to working with Red Tiger’s fantastic team to enhance our combined global reach and to offer further value to operators and players.”

Hillman added that the transaction will provide significant revenue synergies across the companies markets worldwide.

Gavin Hamilton, CEO of Red Tiger, said: “This is an exciting new stage of the Red Tiger story and we are delighted to become part of the NetEnt group. Accessing NetEnt’s unparalleled distribution network and geographic footprint will unlock new opportunities for Red Tiger and will further accelerate our growth.

“At Red Tiger we’ll remain focused as always on driving further innovation and we are looking forward to working with NetEnt on how to leverage our combined capabilities to create new products that wow our customers.”

Shares in NetEnt AB (STO:NET-B) were trading up 8.40 per cent on the news at SEK27.75 per share in Stockholm Thursday afternoon.