Tuesday, December 10, 2024

Aristocrat Agrees to Sell Plarium to Modern Times Group


Globally recognizable gaming and entertainment company Aristocrat Leisure Limited announced its plans to divest a strategic asset.

Plarium’s Divestment to Fuel Aristocrat’s Long-Term Growth Strategy

Today, the company confirmed it has entered into a binding agreement for the sale of Plarium Global Limited, a leading mobile games developer by its subsidiary, Pixel United Holdings Limited, to the recognizable mobile-first gaming group, Modern Times Group. The divestment of the asset has a total enterprise value of up to $820 million.

The announcement is in line with Aristocrat’s strategic review from May this year. The sale of Plarium represents an important part of the company’s growth plan that targets the expansion of its core assets that focus on land-based gaming, social casino and real money gaming. Announcing the sale of Plarium, Aristocrat confirmed that the proceeds from the transaction will be used to fund its “longer-term growth strategy in line with its capital allocation framework.”

Trevor Croker, Aristocrat’s CEO and managing director, confirmed that the divestment of the asset is in line with the company’s focus on core assets growth. Moreover, the executive added: “With the expanded Aristocrat Interactive business now sitting alongside Aristocrat Gaming and our market-leading mobile social casino business, we are increasingly focused on opportunities to lean into Aristocrat’s strengths in regulated gaming content and social slots.”

Aristocrat initially acquired Plarium back in October 2017. The asset helped the company since then and throughout the pandemic by generating an internal rate of return (IRR) that surpassed Aristocrat’s targets. Croker praised the success of the acquisition of Plarium and the solid results it brought. Finally, he said: “Our ownership of Plarium has helped to drive Aristocrat’s digital transformation, extending our track record of successfully acquiring businesses to accelerate our strategy.”

The Acquisition Is Expected to Be Finalized in Q1 2025

A breakdown provided by Aristocrat shares insights about the total consideration of the asset’s sale. The $820 million acquisition cost breaks down to $620 million in fixed consideration which includes $600 million that would be paid upon closing the deal, as well as $20 million in deferred payment due in April 2026.

In addition, Modern Times Group may pay an extra $200 million. However, the extra payment is contingent on “the achievement of certain financial targets over calendar years 2025 to 2028,” as explained by Aristocrat.

The completion of the sale of Plarium to Modern Times Group is expected in the first half of next year. Not unexpectedly, the sale is subject to the relevant regulatory approvals and customary closing conditions.



Source link

Latest articles

spot_imgspot_img

Related articles