LeoVegas acquires Italian gaming operator
LeoVegas today carried out the first acquisition in the Group’s history. The acquisition of Winga.it, an Italian gaming operator with a licence in the Italian market, gives LeoVegas an established position in Italy, Europe’s largest regulated market. LeoVegas is acquiring 100% of the company, which had revenue of EUR 8.0 m in 2016. The acquisition is being made for a cash consideration of EUR 6.1 m.
“This is yet another milestone in LeoVegas’ development,” comments Gustaf Hagman, LeoVegas’ Group CEO. “The acquisition of Winga.it will enable rapid expansion in Italy, as we are acquiring a company with local knowledge and an established position. LeoVegas’ expansion strategy is to grow in markets that are either regulated or in the process of being regulated. Our focus on mobile gaming and our proprietary, flexible technology platform create the conditions for a successful acquisition.”
The Italian gaming market:
Italy is Europe’s largest regulated gaming market, according to data from H2 Gambling Capital. Consumers in Italy spend more money on gaming than what consumers do in, for example, the UK. However, with a very small share of this gaming conducted online or in mobile devices, we see great opportunities for strong growth in the years ahead. This, combined with the fact that the Italian telecom market is facing an interesting development phase in connection with a major upgrade of its telecom networks, makes the timing for LeoVegas to take a position as Italy’s leading mobile gaming company extra interesting.
Winga has an organisation comprising 33 employees and offers customers a full product offering. Fifty per cent of Winga’s revenue is generated from live casino, both from a studio environment as well as from their unique product that is broadcast live on Italian TV and Sky TV.
Winga had EUR 8.0 m in revenue in 2016. Winga is currently showing a negative result, and LeoVegas has identified a number of factors that will bring the company into a positive result.
With LeoVegas as new owner, Winga will benefit from LeoVegas’ data-driven approach in marketing, its strengths on the product side and the mobile technology around the customer experience will contribute significant value added to the business. The LeoVegas brand will be gradually introduced in the Italian market.
The seller of Winga is Paf (Ålands Penningautomatförening). The purchase price will be paid in two parts, and possession is expected to be transferred on 1 March 2017. The transaction is subject to certain customary conditions and approval by the Italian authorities.
With this acquisition LeoVegas now has gaming licences in the following jurisdictions: Malta, the UK, Denmark, Ireland and Italy.
During the past year LeoVegas has evaluated a dozen or so acquisition opportunities, and with a cash position of more than EUR 55 m, the company has resources to make additional strategic acquisitions going forward.