The governance of Cherry Gaming AB has confirmed that it has executed its right to acquire the remaining 51% of shares in European igaming operator ComeOn Malta (ComeOn).
Last July, Cherry had acquired 49% of equity in ComeOn for a shares + cash combination valued at €80 million.
Moving to buy ComeOn outright, Cherry governance detailed this morning that it had agreed to acquire all ComeOn assets for a maximum deal consideration of €280 million (initial €80 million deducted from purchase fee).
The deal will see Cherry pay for the remaining 51% of equity in ComeOn through a combination of 40% new share issuance in Cherry AB and 60 per cent cash commitment. Cherry’s cash commitment is set at up to €135 million and will be issued with a rate of 104.5 of nominal amount corresponding to an annual coupon equivalent to 7.58 per cent.
Cherry governance stated that the total purchase price for acquired assets was based on a multiple of 10x ComeOn’s operating profit (EBIT) for the full year 2016.
Updating the market, Cherry stated that the deal had been approved by its investors, as the company seeks to expand its footprint within lucrative Nordic online gambling markets. Cherry governance further stated that once completed, its new group entity is expected to triple its revenues and become the third largest Nordics-focused private sector gaming company.
Fredrik Burvall, President and CEO, Cherry commented on the acquisition.
“We are very pleased to be able to now conclude the acquisition of ComeOn, which means that we considerably strengthen our position in the market. Together we will create an entrepreneurial-driven gaming company where both Cherry and ComeOn have significantly stronger organic growth than the market, and the acquisition improves the Group’s results considerably. This deal also means that Cherry iGaming will increase its revenues from sports betting. Cherry already has a unique income stream diversification from five different business areas along the gaming value chain”.
Cherry will takeover all ComeOn multi-brand assets, which include ComeOn.com, Mobilebet.com, CasintoStugan.com, MobilAutomaten.com, folkeautomaten.com, Suomikasino.com, GetLucky.com and Kasyno.pl
Ending its acquisition statement, Cherry expects that with the acquisition of ComeOn, it will generate total revenues for the full year 2017 of between SEK 2600 and SEK 2700 million with an EBITDA of SEK 550 to SEK 600 million.