GAN Limited, a leading North American real money iGaming technology provider and a prominent sports betting operator, has announced a definitive Merger Agreement with Sega Sammy Creation, a game development subsidiary of Sega Sammy Holdings, an international gaming, entertainment, and resort company. The agreement stipulates that GAN will receive $1.97 per share, representing a 121% premium over the closing price of the company’s shares on 7 November 2023.
Seamus McGill, Chairman and Interim Chief Executive Officer of GAN, expressed his satisfaction with the agreement, stating, “After a thoughtful review of value creation opportunities available to us, we are pleased to have reached this agreement with SSC. 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.”
The Company will present the Merger Agreement to the shareholders at a Special Meeting of Shareholders to be held not later than March 31, 2024, where approval is expected. GAN assumes that the merger could be closed in the fourth quarter of 2024, and the completion of the deal is reportedly not subject to financing conditions.
Upon shareholder approval, the acquisition of all outstanding GAN’s ordinary shares at a price of $1.97 per share in an all-cash transaction will trigger a 100% title transfer, excluding these shares from trading on any market and relieving the Company from public reporting liabilities under the Securities Exchange Act of 1934.
The Merger Agreement is supported by GAN’s financial advisor, AS B. Riley Securities, and legal counsel Sheppard Mullin Richter & Hampton, as well as Sega Sammy’s financial advisor, SMBC Nikko Securities, and legal counsel Greenberg Traurig.
The merger will bring GAN’s innovative software solutions such as GameSTACK™ comprehensive technology solution for regulated real money internet gambling to Sega Sammy Creation, a gaming machine manufacturer, for implementation in consumer and arcade games, gaming machines, Pachinko/Pachislot machines, and a series of hotels and casino resorts operated by Sega Sammy Holdings.
The impact of the merger has led to a surge in GAN shares, with the stock doubling in pre-market trading after the announcement, marking a significant development in the gaming industry.