TIDM888
RNS Number : 6641V
888 Holdings plc
15 December 2021
15 December 2021
888 Holdings Plc
("888" or "the Group")
Strategic Sale of Bingo Business
Sale of bingo business to increase focus on core B2C and USA
growth strategies
888 (LSE: 888), one of the world's leading online betting and
gaming companies, today announces that it has reached an agreement
to sell its entire B2C and B2B bingo businesses (the
"Transaction"), to Saphalata Holdings Ltd., a member of the
Broadway Gaming group. The consideration is $50m on a cash-free
debt-free basis, including a potential earnout of up to $4m, based
on achievement over six months of revenue-based performance
criteria. Consideration will be paid in cash upon completion of the
Transaction, with the potential earnout payable within
approximately six months thereafter. 888 has agreed to provide
Broadway certain transitional services for a period of up to 12
months from completion, in accordance with an agreed fee
schedule.
888 has a clear strategy to be a global leader in online betting
and gaming by building market-leading positions in attractive
regulated markets, driven by proprietary technology, product
leadership, leading brands, and marketing expertise. As part of a
strategic review, the Group took the decision to sell the bingo
business to improve its focus on its core platform, enabling
greater resources to drive growth in its core markets and reducing
compliance c omplexity arising from related accounts across B2B and
B2C bingo and 888's core platform .
The bingo business, which is delivered through a combination of
B2B services under the Dragonfish brand and multiple leading B2C
brands, is operated on a separate technology platform and primarily
served by a designated operations team. The Transaction encompasses
the entire bingo business of the Group, including all its exclusive
technology, assets, operations, B2B clientele and consumer-facing
brands.
The bingo business, which is substantially UK-based, generated
in 2020 revenue of approximately $65 million and EBITDA of $7.4
million. The loss before tax in 2020 was $76.4 million, including a
goodwill impairment of $79.5 million. The value of the gross assets
subject to the transaction, including the remaining goodwill, as
set out in the 30 June 2021 balance sheet, was approximately US$71
million.
Completion of the Transaction is conditional upon, amongst other
items, completion of a reorganisation of the bingo business and
that new structure receiving its own UK Gambling Commission
("UKGC") licence. Completion is currently expected to occur during
the second quarter of 2022.
Itai Pazner, CEO of 888, commented:
"Following a strategic review, we have taken the decision to
sell the bingo business. This strategic Transaction will enable 888
to further increase its focus on its core platform and unified,
scalable and proprietary technology, and grow our key product
verticals of casino, sport and poker, as we continue in our mission
to be one of the world's leading online betting and gaming
businesses.
The high-quality bingo business has been an important part of
888's history, and over many years we have developed an advanced
B2B offering alongside a suite of popular consumer-facing brands.
As part of an enlarged business, I am very confident that the
future for the bingo business is bright. I would like to express my
immense gratitude for all of the hard work of the team over the
years."
David Butler, CEO of Broadway Gaming, commented:
"We are delighted to reach an agreement with 888 to acquire its
bingo business and platform. By combining these with our existing
business and brands, which include 'Butlers Bingo', we will be able
to achieve an even stronger global footprint in key regulated bingo
markets.
We have worked intensively with the 888 group over the course of
the last few months and have been very impressed by the quality of
the bingo platform and product, the B2C and B2B businesses, its
approach to safer gambling and player protection, and above all the
management team. We see significant further expansion opportunities
in both the B2C and B2B segments, and are very excited about our
plans for the future, as we work closely together to become the
pre-eminent online bingo business globally."
Oakvale Capital LLP acted as financial adviser and Herzog Fox
& Neeman acted as legal adviser to 888, Finres acted as
financial adviser and Wiggin LLP acted as legal adviser to Broadway
Gaming group.
- Ends -
Enquiries and further information:
888 Holdings Plc +350 200 49 800
Itai Pazner, Chief Executive Officer
Yariv Dafna, Chief Financial Officer
Vaughan Lewis, Chief Strategy Officer
Investor Relations ir@888holdings.com
James Finney, Director of IR
888@hudsonsandler.com
Media
Hudson Sandler
Alex Brennan
Bertie Berger
Andy Richards +44(0) 207 796 4133
About 888 Holdings Plc:
888 Holdings plc (and together with its subsidiaries, "888" or
the "Group") is one of the world's leading online betting and
gaming companies. 888's mission is to develop state-of-the-art
technology and products that provide fun, fair and safe digital
gambling products to players globally. Safer gambling is a core
focus for the Group and, a t the beginning of 2020, 888 launched
its 'Safer. Better. Together' safer gambling strategy and
commitments.
888 has been at the forefront of the online gaming industry
since its foundation in 1997, leveraging its proprietary technology
to provide players and B2B partners an innovative and world-class
online gaming experience.
In 2021, the company was proud to be recognised at the EGR
operator of the year awards as the winner of the Casino Operator of
the Year, as well as its in-house sportsbook being recognised as
the In-House Product of the Year. In 2020, the company was proud to
be recognised at the 2020 Gaming Intelligence awards as the winner
in the Casino Operator of the Year category. In 2020, 888 also won
two prestigious awards for its poker platform at the 2020 Poker
Listings Operator Awards in the Most Improved Software and Best
Beginner Software categories.
The Group is structured into two lines of business: B2C, under
the 888 brands, and B2B, conducted through Dragonfish, which
provides partners a leading platform through which to establish an
online gaming presence and monetise their own brands in a safe and
responsible manner.
888's consumer facing websites offer more than just online
betting and gaming. They are entertainment destinations: places
where people can enjoy a truly interactive experience and be part
of an online community that shares common interests. 888's strong
and trusted brands are all accessible through www.888.com .
Find out more about 888 at http://corporate.888.com/ .
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