Casino software giants Evolution Gaming have just made an offer to acquire the equally respected NetEnt. What does these mean for online gambling industry in Africa?
Industry-leading live dealer software developer Evolution Gaming has just made an offer to acquire fellow acclaimed casino game provider NetEnt. Both developers are popular the world over and in January 2020, Evolution Gaming secured a license for the African market, where it now operates extensively.
On Wednesday the 24th of June the proposed offer was announced, shortly followed by reports that NetEnt’s board of directors had unanimously recommended that the Swedish-based company shareholders accept it. If the acquisition goes through, the African market stands to benefit even further, as a greater number of games will fall under the Evolution Gaming license. NetEnt not only offers slots and table games, it has its own live dealer titles too, and these may well be merged with Evolution Gaming’s.
Details of the Offer
Evolution Gaming has proposed 0.1306 of its own shares in exchange for every one of NetEnt’s shares. The live dealer specialist will not offer commission or increase its offered consideration, which values each NetEnt share at SEK 79.93, for a total of around SEK 19.6 billion for all shares. The consideration represents a premium of 43% compared to NetEnt’s closing Nasdaq Stockholm price on 23 June.
Offer completion depends on various conditions, including that it is accepted by shareholders to the extent that Evolution Gaming becomes owner of over 90% of NetEnt shares. In addition, an extraordinary general meeting must be held in which Evolution Gaming must resolve to authorise its board of directors to agree on the number of Evolution shares that will be issued as payment.
NetEnt’s acceptance of the number of Evolution Gaming shares is another stipulated condition. In addition to the listed Series B shares, the Series A shares that are not admitted to Nasdaq Stockholm trading are included in the offer. Evolution will publish an offer document of or around August 14th, and the acceptance period will commence and expire on or around 17th August and 26th October.
Both Companies Appear Pleased
Though the offer has not yet been formally accepted, both NetEnt and Evolution Gaming appear very pleased with the deal, and it is fully expected to be executed. NetEnt Chairman Mathias Hedlund commented that his company had recently undergone vast technical improvements, strengthening its growth prospects.
Hedlund added that combining the NetEnt and Evolution portfolios would create a leading global online casino B2B provider. Through this transaction, he concluded, a new chapter into a more entertaining version of online casino games could begin. Evolution Gaming explained that they had begun considering such an offer just after the 2020 Q1 report.
The live dealer developer’s spokesperson echoed Hedlund’s sentiments on how powerful a combined NetEnt/Evolution Gaming company could be, not least because NetEnt also owns Red Tiger Gaming. Evolution Gaming has been steadily growing in its own right and reported a 49% year-on-year growth for 2019. Acquiring NetEnt should cement its secure position even further.
Looking to the Future
Both companies expect their combined power to be forceful enough to dominate the growing market in the USA. As each state passes its own legislature, they feel their high-quality games will allow them to take significant market shares.
In Africa, meanwhile, where several countries are embracing online gambling, their joined offering might could well be enough to take digital entertainment to new heights.