GVC buys 51% stake in Crystalbet for €41.3m
GVC Holdings, the multinational sports betting and gaming group, is pleased to announce that it has agreed to initially acquire 51% of the equity capital of Mars LLC (“Crystalbet”), with a commitment to acquire the remaining 49% in 2021. Crystalbet is one of the leading online gaming operators in the Republic of Georgia.
Crystalbet was launched in 2011 and holds licences to offer online gaming products, including sports betting, casino games, poker and peer-to-peer games throughout the fully regulated market of the Republic of Georgia.
Since launch Crystalbet has achieved significant growth, driven by its entrepreneurial management team and a highly successful marketing strategy. GVC management believes that Crystalbet is the largest online sportsbook, and the second largest online gaming brand overall, in the Republic of Georgia.
For the financial year ended 31 December 2017, Crystalbet revenues were GEL102.9m (€34m1), with EBITDA of GEL36.5m (€12.0m) and a profit after tax of GEL30.8m (€10.2m). As at 31 December 2017 Crystalbet had gross assets of GEL24.9m (€8.2m), predominantly consisting of cash.
GVC believes that it can further enhance Crystalbet’s profitability and position in the Georgian online gaming market by leveraging the wider Group’s extensive portfolio of games content (including poker), CRM, digital marketing capabilities and purchasing power.
GVC has agreed to acquire an initial 51% of the equity capital of Crystalbet for a consideration of €41.3m, plus a working capital adjustment, to be satisfied all in cash from existing GVC resources (the “Initial Acquisition”). The operational management team at Crystalbet, led by CEO Koba Giglemiani, will all remain with Crystalbet and retain their full equity shareholdings in Crystalbet following the Initial Acquisition. It is intended that GVC will acquire the remaining 49% in 2021, subject to certain buyer protections, at a valuation at the lower of 7 times the 2020 Clean EBITDA2or €150m.
Completion is not subject to regulatory approval and is expected to occur by the end of March 2018.
Kenneth Alexander (CEO) said:
“We are delighted to welcome Crystalbet to the GVC Group, having been impressed with what the management team has achieved thus far. Through access to GVC’s content, technology and digital marketing skills, we believe Crystalbet can become a clear leader in the regulated Georgian market. This acquisition is in line with our stated strategy of being a truly global player, with a focus on regulated/regulating markets.”
Levan Akhvlediani (Chairman of Crystalbet) said:
“I’m proud of all that has been achieved at Crystalbet and believe that in GVC we have found an owner that will both respect the key elements that have made the business so successful and at the same time has the skills and knowledge to take the company to the next level.”
Koba Giglemiani (CEO of Crystalbet) said:
“When we were looking for a strategic acquirer to take Crystalbet to the next level, GVC was very much our first choice. GVC’s experience and track record in many different geographic markets, together with its technology and marketing skills are key attractions for Crystalbet. We very much look forward to being part of GVC Holdings.”