Playtech to Acquire Games Developer GTS8th December 2009 8:50 am GMT
Playtech Limited said Tuesday that it has agreed to acquire Gaming Technology Solutions Limited (GTS), owner of the popular EdGE open gaming platform, in a deal worth up to €21.6 million.
Playtech will pay an initial €10.8 million for the acquisition, financed through its existing cash resources, with further payments based on the future profitability of GTS over the next two years, capped at €21.6 million.
For Playtech the acquisition delivers a highly regarded open platform, a range of games which complement its own core in-house products and an enhanced product pipeline, combining to produce a substantial games selection library of both casino and soft games. Playtech will also benefit from access to GTS' licensees, the majority of which are not current Playtech customers.
GTS provides its gaming solutions to some of the most well established gaming companies in the industry with agreements in place with 15 licensees and 30 separate online gaming brands including the likes of bwin, 888, Sportingbet, Unibet and BetClic.
"We are delighted to welcome the GTS team which will enhance our capabilities in an important complementary product area by bringing a sophisticated technology platform and a portfolio of top quality games as well as suite of new clients," said Playtech CEO, Mor Weizer.
"The success of the games sections in sports betting operators' sites is evident and this deal will give Playtech greater exposure to what is one of the fastest growing industry segments. This is an important strategic acquisition for us and reflects our commitment to provide a comprehensive range of innovative gaming products."
GTS' Enhanced Gaming Engine (EdGE) provides access to products from a diverse range of game developers and content providers. The company has partnered with 19 game content providers with 200 integrated fixed odds, virtual sports, table games and slots from a combined catalogue of well over 500 games. The EdGE platform can also be integrated with Playtech's IMS player management system and as such can substantially increase an operator's capacity for cross-selling onto higher margin products says the company.
"We are positioning Playtech as the independent software provider of choice with market leading integrated technology and a complete portfolio of best of breed gaming products. We see this deal as furthering what is already Playtech's competitive advantage in the growing online gaming market," added Weizer.
"GTS's strategy is very much in line with Playtech's - to be the recognised market leader as a dedicated B2B software provider," said Steven Matsell, GTS's Business Development Director. "This deal will underpin the growth of the platform and we very much look forward to the future as part of the Playtech team."
GTS has a strong track record of games integration and has enjoyed recent growth with revenues for the year ended June 30th 2009 reaching £2.6 million and an adjusted pre-tax profit of £0.3 million before amortisation of intangibles.
Shares in Playtech Limited (Co. Profile) (LSE:PTEC) will commence trading at 416.00 pence per share this morning in London.