ACQUISITION FURTHERS COMPANY STRATEGY OF EXPANDING INTO GLOBAL INTERACTIVE GAMING MARKET
ROME (ITALY) - PROVIDENCE, RHODE ISLAND (US) - Lottomatica S.p.A. announced that its wholly-owned subsidiary, GTECH Corporation, has entered into an agreement to acquire 90 percent of Gibraltar-based St Enodoc Holdings Limited and its subsidiaries including St Minver Limited, the leading provider of end-to-end white label gaming services. GTECH will pay €28 million for the 90 percent equity stake on a cash and debt free basis at closing, and up to an additional €13.6 million based on the performance of the business in 2008 and 2009. The acquisition, which is expected to be completed within the current quarter, is subject to regulatory and certain other closing conditions. Ten percent of St Enodoc will remain with Gary Shaw, Founder and Chairman, until at least 2012, at which point both Mr. Shaw and GTECH have the right to cause GTECH to acquire Mr. Shaw’s shares.
The Company expects to fund the transaction from existing cash balances. In its last reported fiscal year ended June 30, 2007, St Enodoc Group had total revenues of approximately €13.7 million.
“As we continue to expand our presence in regulated Internet-based gaming, St Enodoc is a logical fit,” said Jaymin B. Patel, GTECH President and CEO. “The St Enodoc group has provided white label management services to some of the most recognized brands in Europe operating interactive bingo, poker, and casino games including specialized support for peer-to-peer networks around managing fraud, collusion, and various tournaments. For companies in both gaming and non-gaming industries that want to offer Internet-based gaming, St Enodoc provides solutions to afford these organizations the ability to maintain their brand and customers while essentially outsourcing the gaming operation to St Enodoc.”
“With more gaming markets around the globe approving and regulating interactive gaming channels, GTECH will be well positioned to provide a full-service solution or part thereof,” continued Mr. Patel.
“As the market enters a new phase of development, industrial scale on a global basis will determine which businesses succeed,” said Gary Shaw, Founder and Chairman of St Enodoc. “The St Enodoc management team is delighted that it can leverage its Internet gaming capability to be part of one of the companies that will shape the future of the gaming market.”
The regulated Internet-based gaming market generates an estimated Gross Gaming Yield of $15.1 billion annually. Lottomatica Group believes this market is poised for continued growth, and there will be an increasing demand for Internet-based gaming services and technology in regulated markets in Europe, Asia, and Latin America.
“Given that St Enodoc’s strategy has always been to operate in markets where its offerings are legal and regulated, joining a truly global, highly-regulated business like GTECH, made the most sense,” said Jim Ryan, CEO of St Enodoc. “We can now leverage GTECH’s unrivalled international footprint to further the reach and scale of our games and services.”
Founded in September 2003, St Enodoc currently employs approximately 165 people in Europe including London and Gibraltar as well as Hyderabad, India. GTECH intends to maintain St Enodoc as a separate operation and the St Minver brand identity. The founder and entire senior management will remain with the organization to continue to help grow and develop the business. Currently, St Minver has 98 gaming sites and 76 media, lifestyle, and other branded partners using its white label services. The company does not accept wagers from the United States.
St Minver operates one of the largest bingo networks in the world and offers pooled bingo rooms by currency, each with uniquely managed and optimized schedules. In addition, St Minver supports Boss Media’s IPN, the fifth largest European poker network hosting more than 12,000 players at peak times by providing support services and liquidity through some of its customers.