Raketech ramps up US presence with €16m acquisition

Raketech has concluded a €16m (£13.7m) deal to acquire US-headquartered sports media affiliate firm P&P Vegas Group.

Under the terms of the deal, the firm will pay an initial cash payment of €9m, with the remaining balance of €7m to be paid in the form of 3,881,968 newly issued shares in Raketech.

These shares are subject to a two-year lock-up period, with the purchase prices representing a multiple of approximately 5.6x EBITDA and 3.8x revenue for the last 12 months.

P&P Vegas Group operates US-facing tipster site Picksandparlays from its Ohio headquarters, and a Stockholm-based subsidiary QM Media AB, which operates predominantly as a cricket affiliate.

The deal will see Raketech bolster its US workforce by six employees as well as through the addition of a network of sports betting experts, which should see Raketech’s US revenue double, according to the firm.

Picksandparlays, which has a presence across social media, online and video, has been in operation for over 10 years, attracting 500,000 unique users a month.

Raketech will aim to keep P&P’s existing user subscription-based business model which is based on the sale of picks (tips) to players.

At the same time, the firm has revealed its ambition to further monetise this relationship through Raketech’s existing US sportsbook commercial relationships and generate growth through traditional affiliate activities.

The employees of P&P Vegas Group will officially join Raketech on 15 September when the acquisition is expected to complete.

QM Media AB is currently one of the largest cricket-based affiliates in the world, operating the Onlinecricketbetting.net website, which reaches more than 500,000 unique users during major events including the Indian Premier League (IPL).

“With the acquisition of Onlinecricketbetting.net, Raketech will not only gain a significant position within affiliation of cricket betting, but also take a leading position in the Indian market,” Raketech said.

In addition to QM Media’s existing cricket assets, a portfolio of Nordic sports betting affiliate sites is included in the deal, with the acquisition expected to increase India-facing revenue contribution to up to 10% of the firm’s total revenue going forward.

Raketech CEO Oskar Mühlbach hailed the acquisition as allowing the affiliate to deliver on several “strategically important” goals.

“Significant sports revenues, revenues from high growth markets, boots on the ground in the US and asset diversification and new revenue streams,” Mühlbach explained.

“Furthermore, by adding such a strong brand as Picksandparlays, Raketech will be able to add significant value to the US business through the implementation of the affiliate marketing sales in all licensed states.

“And with the talented and committed team that comes with the acquisition, I am very much looking forward to having them join forces with our central operations team to accelerate growth even further,” the Raketech CEO added.