GAN Wednesday announced it has entered into a definitive agreement and plan of merger with Sega Sammy Creation, a subsidiary of Sega Sammy Holdings. Per the agreement, shares of GAN, a B2B-technology provider of internet-gaming solutions and a sports-betting operator, will be converted into the right to receive in cash $1.97 per share. That price reflects a premium of 121% over the closing price of GAN’s ordinary shares on November 7, 2023, the last trading day prior to the announcement.
“After a thoughtful review of value-creation opportunities available to us, we have reached this agreement with SSC,” said GAN Chairman and Interim CEO Seamus McGill in a statement. “Market-share concentration in the U.S. B2C space, a slower than expected adoption of regulated online gaming in the U.S., along with changes to key customer contracts, make the near-term operating environment challenging without ample capital resources. Sega Sammy has those resources and GAN is a strategic complement to their existing gaming portfolio. We believe this all-cash offer, at a substantial premium to recent trading prices, is the value-maximizing path for our shareholders.”
GAN was granted a conditional a two-year conditional license on Oct. 18 by the Nevada Gaming Commission, which raised questions about the company’s management turnover and finances. Former GAN Director CEO Derek Smurfit resigned in late September, when McGill was appointed interim CEO.
The proposed merger is subject to the approval of GAN shareholders, who will be asked to vote on the transaction at a special meeting expected to be held no later than March 31, 2024.
Completion of the merger isn’t subject to a financing condition, but is subject to the accuracy of the representations and warranties, performance of the covenants and other agreements included in the merger agreement. The merger also is subject to customary closing conditions, including notification or approval with various gaming regulatory authorities. GAN expects the merger to close during the fourth quarter of 2024.
