Tag Archive : B2C

GiG Closes Sale of B2C Business to Betsson

Gaming Innovation Group (GiG) on Thursday closed the sale of its B2C brands to online gambling operator Betsson Group in a €33 million deal.

Betsson thus bolstered its multi-brand portfolio with four new assets. The company acquired the Rizk, Guts, Kaboo, and Thrills casino and sports betting brands from GiG.

Under the terms of the sale, all four brands will continue to be operated on GiG’s platform for a minimum period of 30 months. In addition, Betsson has become a long-term partner of GiG and will generate revenues to GiG’s Platform Services.

As mentioned above, Betsson has paid the amount of €33 million for GiG’s B2C operations and related operational assets. The purchase price included €22.3 million in cash payment, €8.7 million in prepaid platform fee, and €2 million in cash deposit securing GiG’s Spanish casino license, which the company obtained in the summer of 2019.

During the first 24 months after the deal was closed, Betsson will pay a premium platform fee based on net gaming revenue. Based on estimates, GiG could collect up to €50 million from the sale of its four B2C brands.

News that GiG has successfully offloaded its B2C business to Betsson emerge a week after the company secured required regulatory approvals to close the deal.

Sale Frees Up Resources for B2B Growth

GiG said that it would use part of the sale proceeds to repay its SEK300 million 2017-2020 bond on April 22, 2020 as this would strengthen its balance sheet and significantly reduce the financial leverage ratio.

As part of the deal, 63 GiG employees were transferred to Betsson. The two companies have also entered into a Transition Service Agreement, under the terms of which GiG will offer services to Betsson to support the operation of the four brands for an initial period. The agreement comprises an additional 54 employees at GiG.

GiG first announced that it would divest its B2C operations to Betsson this past February. The company said back then that the move was prompted by a strategic review of its business and that it would result in reduction of complexity and improved efficiency.

The gambling group will thus free up resources that would enable it to fully focus its attention on “driving and growing its B2B business.” GiG expects stable and sustainable earnings and profit margins from its new strategic focus.

The company said Thursday that it sees “a large and sustainable addressable market for its Media and platform business” as iGaming continues to become a regulated industry in new markets. In addition, GiG believes that it is well positioned with its omni-channel platform offering to capitalize on the “continued digital transformation” of the global gambling market.

Source: Gaming Innovation Group: Completion of the sale of B2C assets to Betsson

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GiG Sale of B2C Business on Track to Close Mid-April

Gaming Innovation Group’s (GiG) sale of its B2C gaming and sports betting brands to Betsson was this week approved by antitrust regulators, enabling the deal to close by mid-April.

GiG announced in mid-February plans to offload its B2C division to Betsson in a bid to focus on its B2B operations. The move would help the company “reduce complexity and improve efficiency.”

Under the terms of the deal, Betsson, which already operates a multi-brand online casino and sports betting portfolio, has agreed to pay €33 million to acquire GiG’s B2C operations. The purchase amount includes €22.3 million in cash payment, €8.7 million in prepaid platform fee, and €2 million in cash deposit securing GiG’s Spanish casino license.

GiG said this week that it would use part of the proceeds from the sale of its B2C operations to repay its SEK300 million 2017-2020 bond, which would help it strengthen its balance sheet and reduce significantly the financial leverage ratio.

GiG’s B2C operations include the Rizk, Guts, Kaboo, and Thrills online casino and sports betting brands. Under the terms of the sale, Betsson will keep all four websites operational on GiG’s proprietary iGaming platform for the first 30 months after the transaction closes.

During the first 24 months, Betsson will pay a premium platform fee based on net gaming revenue generated. Based on estimated platform fees, GiG could trouser up to €50 million from the sale of the four brands.

Freeing Up Resources to Spearhead B2B Growth

GiG has previously explained that its decision to divest its B2C business was a result of a strategic review as the company seeks to “reduce complexity and improve efficiency.”

The online gambling group has also pointed out that the sale of the four iGaming and wagering brands would free up resources and enable it to fully dedicate its attention to driving and growing its B2B business, and thus secure stable and sustainable earnings and profit margins.

According to GiG, there is a “large and sustainable addressable market” for its platform business as iGaming continues to become a regulated industry in more and more countries around the world.

As part of its strategic review, GiG has also decided to make its platform “sportsbook agnostic” and to partner up with betting technology providers in a bid to offer its clients the best possible wagering solutions.

Under the deal for the sale of GiG’s B2C brands, Betsson will integrate its sportsbook solution onto GiG’s platform. As a result, the two companies will be able to sell their B2B solutions without creating conflict in the B2C vertical.

Commenting on their decision to offload their B2C brands, GiG CEO Richard Brown said previously that the deal would enable them to focus on their growth in the B2B sector and that while offering both B2B and B2C products had synergies in the past, the “current conflicting priorities of the two business areas, and increased complexity in the market, have lessened the potential offering on both fronts and our ability to sign new customers.”

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GiG Sells B2C Casino, Betting Brands to Focus on B2B Growth

Gaming Innovation Group announced today that it has agreed to sell its B2C division to gambling operator Betsson Group in a bid to focus on its B2B operations, “reduce complexity and improve efficiency.”

Under the terms of the deal, Betsson will pay the amount of €31 million on the day the transaction closes. The aforementioned amount will include €22.3 million in cash payment for the acquisition, plus a prepaid platform fee of €8.7 million.

GiG will use proceeds from the transaction to repay its SEK300 million 2017-2020 bond.

GiG’s portfolio of B2C brands includes the Rizk, Guts, Kaboo, and Thrills casino and sports betting websites. Under the terms of the deal, Betsson will keep all four brands operational on GiG’s proprietary iGaming platform for at least 30 months.

During the first 24 months, Betsson will pay a premium platform fee based on net gaming revenue generated. Based on the estimated platform fees, the total value of the sale is expected to reach approximately €50 million.

The deal is subject to regulatory approvals and is expected to close by mid-April.

GiG said that its decision to offload its B2C business was the result of a strategic review the gambling group initiated last November. The review further resulted in an “evolved strategic direction” prompting the company to “reduce complexity and improve efficiency.”

Focus on B2B Business

The sale of its B2C division will free up resources and will enable GiG to fully dedicate its attention on driving and growing its B2B operations. The company explained that it sees “a large and sustainable addressable market for its platform business” as iGaming continues to become a regulated industry in a number of jurisdictions.

GiG also believes that through its omni-channel platform, it is well positioned to capitalize on the continued digital transformation of the global gambling market.

As part of the recently launched strategic review of its operations, GiG has also decided to make its technical platform “sportsbook agnostic” and to team up with other betting technology providers to offer the best possible solutions to its clients.

Under its deal with Betsson, the gambling operator will integrate its sportsbook solution on GiG’s platform. The two companies will thus be able to sell their B2B solutions without conflict of their B2C brands.

To further spearhead the growth of its sportsbook, GiG said that it would seek joint ventures and other collaborations with gambling companies to “release the true asset value” of the solution.

The gambling group plans to seek partners for the growing US market. Here it is important to note that GiG is one of just several B2B providers that offer omni-channel online gambling services in multiple states around the US.

Management’s Comments

Of the acquisition of GiG’s B2C business, Betsson CEO Pontus Lindwall said that they believe the deal offers a good opportunity for his company to consolidate, create synergies, and apply our core B2C skills and marketing insights to scale these assets to their true potential.”

Mr. Lindwall went on that their agreement with GiG will also further strengthen and expand their outreach and growth potential for their proprietary sportsbook solution and payments platforms in the international B2B market.

GiG Chief Executive Officer Richard Brown commented that the transaction enables them to focus their efforts towards the B2B segment and that while “offering both B2C and B2B services had synergies” in the past, the “current conflicting priorities of the two business areas, and increased complexity in the market, have lessened the potential offering on both fronts and our ability to sign new customers.”

Of the integration of Betsson’s proprietary sportsbook into their platform, Mr. Brown said that this would not only provide “cost saving synergies”, but would also allow them to offer one of “the most well-renowned European sportsbooks to our current and future B2B partners.”

Source: Gaming Innovation Group divesting its B2C vertical to Betsson Group

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GiG sells B2C assets to Betsson for €31m

Gaming Innovation Group (GiG) has agreed to sell its B2C assets to operator Betsson for an initial fee of €31m ($33.6m).

The fee consists of €22.3m in cash payments, plus a pre-paid platform fee of €8.7m

Through the deal, Betsson has agreed to maintain the B2C brands on GiG’s platform for a minimum of 30 months, paying a platform fee based on NGR generated for the first 24 months.

Including these platform fees, GiG expects the total value of the deal to be approximately €50m.

GiG decided to sell the assets after a strategic review in November 2019, which saw the company develop a plan to reduce its complexity and improve efficiency.

Richard Brown, CEO of GiG, said: “I am very excited about this transaction as it provides multiple upsides to GiG.

“While putting the company in a financially sustainable position, it gives us the ability to focus on where we see real long term shareholder value.”

Pontus Lindwall, CEO of Betsson, said: “We believe this deal offers a good opportunity for Betsson to consolidate, create synergies and apply our core B2C skills and marketing insights to scale these assets to their true potential.

“The agreement with GiG further strengthens and expands Betsson’s outreach and growth potential for its proprietary sportsbook and payments platforms in the B2B market.”