Published on the 2021-02-05
Internet gaming software company GAN Limited has secured a deal for the megabucks purchase of Vincent Group PLC who is known for their Coolbet brand in an acquisition that is reported to be in the region of $175 million in both cash and stock options.
The details of the deal mean that Coolbet’s proprietary software will be integrated into GAN’s current B2B technology portfolio in a bid to make a serious move into the ever increasing US market in the third quarter of 2021 - a region that has already witnessed explosive growth.
It means that the founder of Coolbet, Jan Svendsen whose knowledge is invaluable to the future plans of GAN stays on board and as a result, will continue to run operations across Northern Europe, Canada, and Latin America as well as being responsible for the identification of new markets.
Svendsen launched the Coobet brand in 2016 and very quickly witnessed considerable growth. Leveraging over 30 years of experience in the gambling industry, Svendsen is somewhat of a reputable stalwart and is perfectly positioned to continue to drive the brand forward under the GAN compay vision.
GAN CEO Dermot Smurfit commented upon securing the deal: “The completion of the Coolbet acquisition brings together two best-in-class offerings in the igaming space today, and makes a powerful combination by creating a fully-integrated offering, customizable for each client’s needs.
“We have already started to welcome the Coolbet team of over 175 employees and engineering talent to our organization and expect the integration process to be seamless. Over the last few weeks, the GAN and Coolbet teams have spent significant time together outlining our exciting future and have grown even more confident in the numerous revenue synergies that we see across both platforms.
“We look forward to leveraging one of the most complete solutions in our industry both domestically and internationally, and believe our growth platform is well positioned to drive long-term shareholder value.”
A company that is keen to expand across new markets, in particular northern America, GAN can strategically use this deal as a way to identify future partnerships, and software providers may begin to attract attention.
Partnering with a developer such as NetEnt could well make sense strategically. Svendsen, in particular, who will be responsible for identifying new opportunities is well known in Scandinavia, especially by NetEnt as well as Evolution Gaming who have since joined forces in an ambitious merger.
What is being realised by online gambling brands, especially from a future growth perspective, is that synergistic alliances are the way forward when it comes to trying to gain a foothold in a new market and this refreshing approach has a number of advantages for all involved.
Although a possible partnership for NetEnt with GAN might at the minute seem some way off, there is definitely scope. Already the software provider has a number of tactical allegiances in a couple of US states and because of this, it may mean that a significant operator group such as GAN may look to explore the possibility of joining forces.
The benefit here for GAN is that they would be able to gain a lot from the high level of expertise that NetEnt and Evolution Gaming are able to provide them with especially for certain, specialised niches such as jackpots.
It is fair to say that NetEnt is renowned for having some of the best and biggest jackpot slot games in the online gambling industry, while GAN has the platform to seamlessly integrate these into their service offering, as well as having a ready made customer base.
Also, it would mean that any new jackpot slots that are developed by NetEnt will be able to secure a much more efficient route to a potentially lucrative and new marketplace in the form of the US, Canada, and Latin America, especially as more legislation is passed.
In addition to this NetEnt can also benefit from the expertise that GAN could offer in terms of market research that is centred around what players in these regions like from their jackpot slots experience and as a result how new slots can be made even better for the player.
There are a lot of similarities between both GAN and NetEnt, perhaps the most obvious one being that they are first and foremost technology companies who are right on the cutting edge of innovation and as a result are always looking for new ways to enhance a player’s gameplay.
Furthermore, both of these companies have significant databases, which when it comes to the development of new products can be highly beneficial for both parties from both a market research and customer acquisition point of view.
This is something that no doubt will have been at the centre of merger talks when the deal with Evolution Gaming was being negotiated. It goes without saying that the level of ambition involved in this merger is significantly huge which means that there is definite scope to grow further should this be agreed on.
Online gambling though is an industry where if companies agree to partnerships without doing the appropriate levels of due diligence can lead to problems down the line, especially considering the amount of investment that might be needed in order to gain traction.
The fact that partnerships between both brands have already started to take place, especially in new regions means that they are clearly open to new opportunities, but what is also key is that these happen at the right time.
Too many in such a short space of time can potentially lead to a loss of brand identity and integrity, while also diluting company values and reconfiguring processes for the worse. Ultimately, any future partnerships will more than likely be the subject of carefully planned consideration though it is definitely an exciting time for NetEnt and their fans.