Amaya bolsters lottery business with Diamond Game deal
$25m deal to be completed in Q4 " Diamond Game CEO says deal "unlocks value for both companies"
Amaya has increased its North American lottery footprint with the acquisition of games designer and manufacturer Diamond Game.
The Montreal-based supplier will pay a total fee of US$25m in cash for Diamond Game, with the deal “subject to Amaya receiving all necessary licensing and regulatory approvals”, and will be completed in the fourth quarter of 2013.
Amaya CEO David Baazov (pictured) highlighted the potential upside from Diamond Game’s LT-3 lottery terminal, which has already been rolled out in Maryland and Ontario, adding that the deal is “anticipated to be accretive to adjusted EBITDA”.
Diamond Game’s chief executive Jim Breslow said: “The transaction unlocks value for both companies by pairing our patented technology, innovative products and key contracts in the Lottery segment with a well-capitalised entity in Amaya.”
He added that the supplier has a “solid foundation” of expertise as well as “key relationships” throughout the industry.
The deal is the latest in a flurry of acquisitions for Amaya, the most recent being gaming machine manufacturer Cadillac Jack, which was acquired for $167m in September last year.
While its growing list of purchases “ Ongame and Cryptologic being the others “ helped the business record a 316% year-on-year revenue increase in its 2012 results, the company made a net loss of $7.12m over the same period. The cost of these deals, alongside amortisation costs and employee contract terminations, were blamed for the loss.
Baazov has also been bullish about plans to roll out its cash poker offering in the US market, anticipating a launch in the third quarter of the year.