(Alliance News) - Moody's Investors Service on Wednesday affirmed the B1 corporate family rating of the online gaming operator JPJ Group PLC, with a stable outlook.
Moody's explained that the rating action follows the former Jackpotjoy's announcement in mid-June that it has agreed to buy Gamesys Holdings Ltd, excluding sports brands and games, for GBP490 million.
The acquisition is to be financed by GBP250 million in cash, JPJ said at the time, of which GBP175 million is to be funded by an add-on to JPJ's existing debt facilities, plus 33.7 million in newly issued shares.
The enlarged group is to be renamed Gamesys Group PLC, and completion is expected in the third quarter of 2019.
Moody's said the acquisition of Gamesys will diversify JPJ by adding website and app development, and a US presence with expansion potential.
The ratings agency said it expects JPJ to increase its ability to "absorb" regulatory change after the introduction of gaming taxes in Sweden and the increase in UK remote gaming duty to 21% from 15% in April.
The rating also reflects its leading position as the "largest" online bingo operator in the UK, with active customers nearly doubling after the acquisition, Moody's said.
Meanwhile, the stable outlook reflects Moody's expectation that JPJ will continue to grow and use its strong free cash flow to improve its leverage.
