LONDON (Alliance News) - Gaming Realms PLC Tuesday said it has agreed to buy e-gaming marketing company Blueburra Holdings, the holding company of Digital Blue, for up to GBP10.5 million, following on from its acquisition of marketing agency QuickThink Media late last year.
In order to part fund the acquisition, Gaming Realms said it has conditionally raised about GBP6.0 million through a placing of 18.1 million new shares at 33 pence each with new and existing shareholders. Gaming Realms shares were Tuesday untraded at 36.50p.
Chief Executive Patrick Southon said the acquisition is in line with Gaming Realms' long-term strategy to increase the combined databases of its subsidiaries.
"Blueburra Holdings will boost our product and marketing initiatives to target the fast growing and overlapping audiences using mobile and tablet platforms which, in turn, will help to accelerate the group's future revenue growth," Southon said in a statement.
The group thinks that acceleration will be achieved by adding "further reach and capability" to Quickthink Media and adding an enlarged database of players for cross promotion, as well as further DragonFish Bingo Skins, which it thinks will allow for greater group cross marketing and monetisation.
Gaming Realms said the acquisition is intended to provide the group with a stronger position in the online gambling market, with the deal expected to allow for a more rapid roll-out of the group's own gambling products. These are planned to go live by the end of August.
The acquisition will add approximately GBP1.1 million of annual earnings before interest and tax to the group, according to Gaming Realms. BlueBurra Holdings had GBP2.2 million in assets at the end of January, reported GBP3.8 million in revenue and GBP1.9 million in pretax profit, including GBP750,000 of "extraordinary" income on the sale of intellectual property, in the 11 months ended January 31.
Gaming Realms will make an initial payment of GBP5.0 million for BlueBurra Holdings, which will be split equally in cash and new shares issued at 33p each. The remaining amount is payable over the next three years, subject to certain earn-out targets and adjustments, with up to GBP2.75 million potentially payable in cash and up to GBP2.75 million potentially payable in new shares.
In addition, certain members of the existing management team of Blueburra Holdings will join the combined business.
Gaming Realms also said it is trading in line with expectations.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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Gaming Realms (GMR)