MGM set to acquire LeoVegas and expand its presence globally

MGM set to acquire LeoVegas and expand its presence globally

  • CDC Gaming Reports
August 31, 2022 7:14 PM
  • CDC Gaming Reports
  • Europe
  • United States

MGM Resorts International Wednesday announced that its public-tender offer for the shares of LeoVegas, the Swedish online gaming company, has been accepted by 96% of LeoVegas shareholders at an approximate value of $604 million as part of a move to spread the casino giant’s presence around the world.

Settlement of the shares is expected to be initiated on Sept. 7 for 61 Swedish kronor. LeoVegas is headquartered in Stockholm with major offices in Malta, United Kingdom, and Milan, Italy.

Founded in 2011 by Gustaf Hagman and Robin Ramm-Ericson, LeoVegas is a global online-gaming company with licenses in nine jurisdictions, primarily in the Nordics and rest of Europe. LeoVegas generated €394 million in revenue and €46 million in adjusted EBITDA during the 12 months ended June 30.

In making the announcement, MGM Resorts said the acquisition of LeoVegas will provide a unique opportunity for the company to create a scaled global online-gaming business offering strategic opportunities to accelerate growth and product offerings. LeoVegas’ online casino and sports betting capabilities have a strong customer base outside the U.S.

LeoVegas’ management team has demonstrated the ability to develop a robust and scalable technology platform with advanced product offerings, according to MGM.

In addition, MGM executives noted that LeoVegas has operated profitably as a high-growth platform since 2014. From 2017 to 2021, its revenue’s compounded annual growth rate was 16%, while maintaining strong profitability, MGM said.

MGM Resorts’ scale, brands, and expertise will allow the combined businesses to expand within existing gaming segments and provide incremental opportunities to enter new areas, said MGM Resorts’ CEO and President Bill Hornbuckle.

“The completion of this transaction represents a major milestone for MGM Resorts as we continue to pursue our strategy of growing our online gaming footprint worldwide,” Hornbuckle said in a statement.

Hagman, LeoVegas Group CEO, said joining forces with MGM Resorts is a major win for his company and that their new teammates will help build on the work they’ve done over the last 10 years.

Casino consultant Brendan Bussmann, managing partner of B Global, told CDC Gaming that the move by MGM “further solidifies its ability and desire to compete in the online space.” MGM acquired a brand that they think will add to their portfolio and expand upon their relationship with Entain, he said.

MGM has a joint venture on BetMGM with UK-based Entain, one of the world’s largest sports betting and gaming groups.

“I don’t see it affecting anything with Entain,” Bussmann said. “I think it probably adds to their portfolio.”