Intralot has completed the acquisition of Bally’s Corporation’s International Interactive segment for a cash-and-shares deal valued at €2.7bn, combining the business with the Athens-listed lottery and gaming company.
The transaction is broken down as €1.53bn in cash consideration and €1.136bn in newly issued shares in the new Intralot, which will be led by Bally’s CEO and board member, Robeson Reeves, as CEO and has ambitions to become a global iGaming champion.
Combining the new 873,707,073 shares with its existing 207,534,878 shares, Bally’s now holds a 58% shareholding in Intralot and is the company’s majority shareholder. The lottery group is also now one of the largest companies by market capitalisation on the Athens Stock Exchange.
Reeves noted: “This is a milestone transaction for Bally’s. We have unlocked significant liquidity in a key asset while establishing an even stronger platform for digital growth. Our shareholders now have visibility into the value of our interactive division as part of a larger, globally scaled operator.
“Intralot’s lottery expertise and reach, combined with Bally’s International Interactive’s proven digital capabilities, creates a powerful foundation for expansion over the long term.”
Global iGaming champion
Intralot stated it is now “a global iGaming and lottery champion with enhanced scale, diversification, and a highly complementary product offering across B2G, B2B and B2C channels”.
The company added that, pro forma for the transactions above, the combined entity would have had “approximately €1.1bn in pro forma run-rate adjusted revenue”, with a “pro forma run-rate adjusted EBITDA margins in excess of 39%”.
“The integration brings together Bally’s International Interactive’s proven digital capabilities and Vitruvian data platform with Intralot’s scale and lottery infrastructure, including LotosX and PlayerX lottery systems long-standing B2G relationships, across 40 jurisdictions,” said Intralot.
The Athens-listed group also expects the acquisition to provide “significant cross-selling opportunities, drive growth and long-term value creation”.
Bally’s begins debt reduction
Bally’s noted that it intends to allocate at least $1bn of the cash after-tax proceeds from the transaction for secured debt reduction, including outstanding revolver balances.
The company added that it will “substantially reduce debt” when combining the funds with Bally’s Twin River Lincoln Casino Resort’s contemplated sale and leaseback, which includes the application of $500m to reduce secured debt and credit facilities.
“The transaction also allows Bally’s to maintain ample liquidity, including its recently announced increased $670m revolver, to pursue the Company’s strategic growth development initiatives,” said Bally’s.
“In this regard, Bally’s also expects to allocate a minimum of $200m of cash to fund the development of its Chicago casino as construction accelerates in conjunction with the $940m commitment under its agreement with Gaming and Leisure Properties.”
The funding comes at a good time for Bally’s, as the operator recently announced its plans for Bally’s Las Vegas, which will be on the former Tropicana Las Vegas site on the Las Vegas Strip.
The NYSE gambling group is also currently in the final four for one of the three commercial casino licences available in New York State, with its Bally’s Bronx project in Ferry Point, The Bronx.
