Gambling.com completes acquisition of XLMedia’s affiliate assets
3rd April 2024 9:50 am GMT
Gambling.com Group has completed its previously announced acquisition of XLMedia’s European and Canadian sports betting and gaming affiliate assets.
The acquisition includes the Freebets.com site and follows the payment of an initial cash instalment of $20.0 million, with an additional $10.0 million to be paid on the six-month anniversary of closing.
A final payment of between $7.5 million and $12.5 million will be paid on the one-year anniversary of closing, subject to the revenue performance of the assets during the remainder of 2024.
Gambling.com expects the acquired assets to generate revenue of $10.0 million and incremental adjusted EBITDA of $5.0 million over the remainder of 2024.
“While expansion of gambling in the US grabs all the headlines these days, many of the industry’s most attractive markets remain in Europe, the historical home of the industry,” said Gambling.com CEO and co-founder Charles Gillespie. “I expect this acquisition to fundamentally change the balance of power within the European online gambling affiliate market and provide Gambling.com Group with a clear path to drive further growth in both our existing European markets as well as new ones.
“As part of the transaction, we are gaining a number of new colleagues in the region. I look forward to sharing our leading technology platform and high performance culture with our new team members.”
XLMedia will incur transaction costs over a period of six-months to support the migration of the assets, but expects to generate net proceeds from the transaction of around $35.0 million.
This will be used to pay the final deferred acquisition payment of $4.0 million due in 2024, provide working capital for the North America business, and settle outstanding tax provisions while returning cash to shareholders.
“The business's strategy continues to focus on North America Sports including expanding its footprint, deepening audience relationships and diversifying revenue streams with the goal of developing more predictable, stable income and building its Gaming vertical,” said the company. “XLMedia's Board will continue to execute this strategy whilst also evaluating ways to maximise shareholder value.”
Shares in XLMedia plc (LSE:XLM) were trading 1.01 per cent lower at 12.25 pence per share in London Wednesday morning, while shares in Gambling.com Group Ltd (NASDAQ:GAMB) closed 0.86 per cent lower at $9.21 per share in New York Tuesday.
