The gaming company Gaming Innovation Group Inc (GiG) has agreed to sell some of its casino brands to Betsson Group in a deal the company says will be worth €50 million.
Some 65 employees will, as a result of the deal, be shifting to Betsson, Times of Malta can confirm.
GiG chief financial officer Justin Psaila on Friday insisted the affected employees will retain their work contracts as Betsson had bought these as part of the deal. There will not be any redundancies as a result of the hand-over, he said.
The Share Purchase Agreement arranged between the two companies will see GiG sell several of its brands to repay a €28.59 million bond acquired for the period of 2017 and 2020.
The bulk of the transaction will involve a €31 million payment consisting of a €22.3 million cash outlay for the initial acquisition and a further €8.7 million as a pre-paid platform fee, GiG said in a statement.
Betsson will keep these business-to-consumer brands operating for a minimum of 30 months and generating revenues for GiG’s platform services. It will also pay a premium platform fee on the net revenue generated from the brands, bringing the total cost of the transaction to approximately €50 million.
Last month, GiG had acknowledged that it was going through a "strategic review" of its business but denied rumours that the company was downsizing its workforce or planned to leave Malta.
GiG said that this move is part of its strategic review that it carried out in November. They say that it “will free up resources, enabling full dedication on driving and growing its B2B business, securing stable and sustainable earnings and profit margins.”
“GiG has, as part of the strategic review, taken a decision to make its technical platform sportsbook agnostic, and partner with other sport book providers to offer the best solutions to its customers. Betsson’s sportsbook solution is intended to be integrated on GiG’s platform-offering.
“Both GiG and Betsson will gain strategic advantage in having the possibility to sell their respective B2B solutions in an environment without conflict of their own B2C brands,” they added.
'We will not be packing up and leaving'
In his comments to Times of Malta on Friday, Mr Psaila was adamant that the company was not thinking of "packing up and leaving". In recent months, there have been rumours that the gaming industry in Malta could soon be facing challenges.
However the deal with Betsson was simply part of the strategic review and completely unrelated to any changes the industry could be facing, Mr Psaila said.
On whether the company would be implementing any further measures in the coming months, Mr Psaila would not say. He insisted he could not commit that no more developments would take place since there was continuous evaluation within the company.
"This is ultimately very good news. There will not be any redundancies and the deal will continue to ensure financial sustainability," he said.
Move will help Betsson strengthen its position
Betsson CEO Jesper Svensson described the deal as an "exciting one", saying that this would allow the company to expand its operations.
"We intend to grow and this strengthens our position. The deal will also help with growing the brands and improve product opportunities," Mr Svensson said.
He echoed comments that the 65 employees moving from GIG to Betsson would retain the same contracts and continue to enjoy the same packages they had up until the deal.