In a notable move within the gaming industry, Sega Sammy Creation (SSC), an affiliate of the renowned Sega Sammy, has been given the green light by GAN shareholders for a significant acquisition deal. This transaction, worth $107.6 million, stands as a strategic expansion for SSC, indicating an ambitious foray into the burgeoning igaming market of the United States.
The acquisition, initially agreed upon in November of the previous year, was contingent upon various conditions, the primary one being the approval of GAN’s shareholders. In a decisive vote that took place on the 13th of February, a sweeping majority of over 95% cast their votes in favor of the deal. This impressive consensus among shareholders punctuates the common interest in seeing the transaction succeed.
In addition to the vote on the acquisition, GAN shareholders also sanctioned the compensation that may be allocated or become due to GAN’s named executive officers in the wake of the merger. These approvals represent significant milestones on the path towards finalizing the deal, which still requires the satisfaction of other conditions before it can be concluded. If all requisites are met, the acquisition timeline is expected to reach closure by late 2024 or early 2025.
Upon the completion of the merger, GAN will amalgamate with a newly formed special purpose company under SSC, with GAN surface as the surviving entity. This will mark the end of GAN’s tenure as a publicly traded company, prompting the delisting of its ordinary shares from the Nasdaq Capital Market and their subsequent deregistration—a herald to new business horizons under the Sega Sammy umbrella.
Sega Sammy’s rationale behind the acquisition stretches beyond a mere extension of their gaming business. Already managing an integrated resort in Japan through Paradise City, and provisioning gaming equipment and content via SSC, Sega Sammy sights the US igaming market as a realm filled with “promising” growth potential. As more states within the US soften their stance on legal igaming, this move positions Sega Sammy to directly leverage existing operators’ expansions and the entrance of new players into the market.
This strategic leap follows a review that GAN initiated in the first quarter of the preceding year, scrutinizing strategic alternatives to enhance shareholder value. By September, GAN maintained an open stance, considering various options, including the potential sale of parts or the entirety of the business. Interest was expressed by several parties, marking the period as one of introspection and future planning for GAN. Alongside these developments, GAN saw the departure of its long-serving CEO Dermot Smurfit, who completed an over 21-year tenure. Assuming the interim CEO position was Non-executive chairman Seamus McGill.
The acquisition of GAN is the latest in a series of strategic business expansions for Sega Sammy following the historical merger between Sega and Sammy Corporation. Another remarkable acquisition took place in August, when they bought Rovio Entertainment, the creators behind the Angry Birds franchise, for a staggering €706.0 million. Although Sega Sammy established dialogue early in the year regarding the purchase of Rovio, they faced competitive interest from other entities, including Playtika. Playtika had made several offers for Rovio but eventually withdrew from talks, clearing the stage for Sega Sammy’s successful acquisition.
As the deal progresses, the gaming industry watches with keen interest, anticipating how the integration of GAN into Sega Sammy’s expanding portfolio will shape the contours of the igaming landscape, notably within the United States, as this market continues to exhibit significant growth and transformation.
