Aristocrat exec discusses NeoGames acquisition with Nevada Gaming Control Board

June 7, 2023 9:29 PM
Photo: CDC Gaming Reports
  • Buck Wargo, CDC Gaming Reports
June 7, 2023 9:29 PM

The chief product officer with Aristocrat that’s acquiring NeoGames for $1.2 billion told Nevada gaming regulators Wednesday that the Israeli-based online-gaming provider will be a great addition to the company.

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Matthew Primmer appeared before the Board on a routine matter and addressed the acquisition that was announced in May.

Aristocrat has said the takeover will give the company an entry into the ilottery market and pave the way to further penetrate online gaming. In May, NeoGames was licensed to operate in Nevada.

Aristocrat was keen to acquire NeoGames’s technology platform, in addition to a sportsbook. “It gives us global scale in the igaming markets,” Primmer said, “end-to-end solutions for igaming, ilottery, and online sports.”

The deal will take 12 to 18 months to close. NeoGames shareholders must vote on the acquisition and Aristocrat will need approval for the acquisition.

NeoGames, founded in 2014, has 1,100 employees in eight main locations around the world. Its first U.S. customer was the Michigan lottery; the company also services New Hampshire, Virginia, North Carolina, and Alberta. Half of its management team resides in Israel and most of the other half is in Europe. It also has customers in Europe, Africa, and Latin America and works in 50 regulated jurisdictions.

Revenue for 2023 is projected at $235 million to $255 million. Sports betting makes up about 10%, while ilottery predominates.

In other Control Board action, a little over a year after MGM Resorts took over the operations of The Cosmopolitan Las Vegas and set up a BetMGM sportsbook in place of one operated by William Hill, the Board recommended MGM be approved to operate a satellite race book and sports pool. It now goes to the Nevada Gaming Commission.

Sean McGuinness, MGM’s gaming attorney with the firm Butler Snow, told the Board there were some issues with the transition. Due to an enhanced review by the Federal Trade Commission, MGM was able to do a “deep and thorough review” of the Cosmopolitan’s operating systems only after they took over the operation in May 2022.

McGuinness said that in June 2022, MGM saw that its system didn’t communicate effectively with Cosmoplitan’s. “We immediately reached out to the Gaming Control Board. By the time the Technology and Audit Division issues were clarified in July, it was too late to get on the agenda for a satellite designation before the August cutover and get the race and sportsbook operational.”

Pat Madamba, senior vice president and legal counsel, said manual entries for what should be automated are ongoing.

“We’re working on a bridge to get two systems to talk,” Madamba said. “We want to put them together with the least amount of friction for our Cosmopolitan customers, who’ll become MGM Rewards members, and our employees. Combining the systems and launching MGM Rewards (should happen) in the first quarter of next year. We paid a lot of money for that business and we certainly want to preserve that business.”