GAN CEO Smurfit Says Small Offers Are in Play for Firm
Posted on: April 19, 2021, 08:09h.
Final up to date on: April 19, 2021, 08:09h.
Gaming expertise supplier GAN Ltd. (NASDAQ:GAN) is in search of smaller acquisitions because it goals to hit $100 million in 2021 income.
The UK-based firm, which went public final Could, is seeking to bolster its menu because the US on-line casinos and sports activities wagering markets soar, creating demand from gaming operators for expertise companies. GAN gives enterprise software program as a service (SaaS) options for on-line on line casino and sports activities betting platforms, primarily by means of its GameSTACK web gaming providing.
In an interview with The Impartial, CEO Dermot Smurfit, Jr. is on the hunt for smaller offers within the $5 million to $50 vary because it continues to combine its buy of Coolbet. GAN accomplished the $175 million buy of the European iGaming and sportsbook operator in January. That’s the customer’s greatest purchase to this point.
It might be some small, bolt-on acquisitions which might usually be… anyplace from $5 million to $50 million could be an apparent candy spot vary for us,” stated Smurfit.
The GAN boss indicated it’s unlikely the corporate’s subsequent acquisition might be as giant because the Coolbet deal.
GAN Firepower for Deal Making
Owing to a powerful steadiness sheet, Smurfit’s agency has the wiggle room for purchases, notably within the worth vary the chief government is concentrating on.
The corporate funded the Coolbet purchase with a mixture of money and fairness. GAN inventory is on a wild journey — slumping 35.14 % over the previous month, leading to a year-to-date decline of 9.52 %. Nevertheless, that’s usable foreign money in relation to shopping for smaller corporations. Moreover, the corporate had $153 million in money and no debt on the finish of 2020, offering ample flexibility for deal making.
“We’ll proceed to spend money on proprietary software program growth to deliver Coolbet’s sports activities choices and different crucial product growth to the market,” stated CFO Karen Flores on the corporate’s fourth-quarter earnings convention name. “We’re nicely capitalized to deal with this. And our key priorities of securing market share, getting into new states as they legalize, delivering one of the best platform expertise to the market and exploring opportunistic and accretive M&A.”
Within the Impartial interview, Smurfit didn’t point out particular potential targets nor did he point out desired geography for acquisitions. GAN derives greater than 80 % of its income from US-based shoppers.
Robust Market Share
Broadly talking, GAN isn’t a consumer-facing firm, so it’s not a recognizable model to many gamblers. It’s, nevertheless, well-known to operators.
As a lot is confirmed by market share knowledge, indicating the corporate’s platform powered 21 % of the US iGaming market final yr whereas accounting for 60 % of the web on line casino business-to-business provider market, in line with Flores.
That’s enviable positioning at a time when analysts view the US web on line casino trade in its nascent levels and poised to ship exponential development over the subsequent decade-plus.
Latest additions to GAN’s consumer roster embody Churchill Downs and Wynn Resorts.