Cherry acquires 49% stake in ComeOn for €80 million

Swedish Nasdaq-listed igaming operator Cherry AB has this morning confirmed that it has agreed to acquire a 49% stake in Malta based European casino and sports betting operator ComeOn Limited for a consideration of €80 million.

Publishing deal terms, Cherry AB detailed that it would acquire its ComeOn stake in two tranches consisting of a € cash and new share issuance.

The price per share has been negotiated at SEK 128.25. Cherry intends to issue a corporate bond to finance the cash part of the deal. Initially, €50 million will be issued. The bond will be listed on Nasdaq Stockholm Corporate Bonds within 60 days following the day of issue.

On announcing its acquired stake in ComeOn, Cherry AB governance declared that the investment would ‘significantly strengthen Cherry’s position within Scandinavian markets and also provide great opportunities for continued international expansion’.

ComeOn are reported to have generated ‘2015 Sales’ of €80 million combined with operating profits of circa €13 million, with the company detailing a 70% increase on 2014 performance metrics. ComeOn management target a 2016 operating profit of bwtween the €19-23 million mark.

Fredrik Burvall, CEO Cherry AB commented on the acquisition

“This acquisition will strengthen Cherry’s position in online gaming against competitors in Scandinavia and other European markets. Both Cherry and ComeOn are growing considerably faster than the market as a whole, which facilitates further investments in existing brands and continued expansion in new markets. We will add several strong brands and will profit from the strong entrepreneurial spirit within ComeOn,”

Cherry governance stated that it would look to create new synergies with its new investment, but further confirmed that it would make no redundancies as both companies were growing. Cherry will further maintain ComeOn founders and all senior management.

Cherry AB expects the deal to be approved in its special shareholders meeting expected to take place at the end of May.