Australian gaming company Aristocrat Leisure announced on Monday its plan to acquire NeoGames SA, an online gaming solutions provider based in Israel, for approximately $1 billion. The news caused NeoGames’ shares to surge by 120% in premarket trading.
NeoGames’ U.S. shares were trading at $28.22 before the market opened, while Aristocrat’s shares ended 2.1% higher at $39.51.Under the deal, Aristocrat will pay $29.50 per share to acquire 100% of NeoGames’ shares, offering a premium of about 130% compared to NeoGames’ last closing price of $12.84.
In a statement, Aristocrat stated that the acquisition will allow them to enter the highly regulated iLottery market and expand their presence in other online real-money gaming verticals.
Analysts at Citi noted that while Aristocrat paid a significant premium, the deal provides a pathway for sustained growth and aligns with the company’s strategy to expand its real-money gaming sector. Aristocrat has been actively pursuing this strategy, including the acquisition of Roxor Gaming in September.
NeoGames specializes in providing content and technology solutions for the online real-money gaming industry. The group also includes BtoBet, a sports betting solution provider, and Pariplay, a content provider.
Aristocrat CEO Trevor Croker stated that the acquisition of NeoGames and its leading online gaming platform will enable the company to offer a comprehensive range of solutions for iGaming, iLottery, and online sports betting operators worldwide.
Both NeoGames and Aristocrat released separate statements, with NeoGames recommending the offer to its shareholders, and Aristocrat announcing that shareholders holding 61% of NeoGames’ outstanding shares have agreed to vote in favor of the deal.
Aristocrat expects the acquisition to contribute to its profits by the financial year 2025. Additionally, the company announced an increase of A$500 million ($339.2 million) to its existing share buyback program.
