12 Sep 2016 07:00
LONDON STOCK EXCHANGE (LSE): GAN | IRISH STOCK EXCHANGE (ISE): GAME
GAN selected by existing US casino client to launch real money Regulated Gaming in Europe
$1.4m up-front cash payment, multi-year marketing commitment with material income participation for GAN
London & Dublin | September 12, 2016: GAN plc (“GAN” or the “Company”), an award-winning developer and supplier of enterprise-level B2B Internet gaming software, services and online gaming content in the United States, announces it has extended an existing partnership with a major US casino operator (the “Client”) to launch an International overseas real money Internet casino gaming website and mobile App (the “Overseas Internet Casino”). The new website and App are expected to launch in H1 2017 and will target Europe and other International regulated gaming markets outside the US under a seven year contract with the Client.
Highlights
GAN’s first US Casino client to extend partnership into overseas’ regulated Internet gaming markets GAN selected following an extensive due diligence process based on its deep and proven capability in providing a custom-designed real money gaming experience integrated into an on-property loyalty program and casino management system GAN to receive an up-front $1.4m cash payment for intellectual property assets and development services following completion of customary due diligence and regulatory approvals – expected in Q4 2016 Launch of the Overseas Internet Casino will be supported by a minimum user acquisition marketing budget wholly funded by the Client: $10m per annum over the term of the seven year contract GAN to participate materially in the net income generated by a unique Internet casino offering principally targeting a growing European Internet gaming market which is forecast to reach a value of $16.5bn in 20171 The Overseas Internet Casino is expected to launch online in H1 2017 and will be integrated into the Client’s on-property rewards program - the first International real money Internet casino offering non-US resident players access to a major US casino’s exciting rewards program.Management Commentary
Dermot Smurfit, CEO of GAN commented: “GAN’s unique casino product is performing strongly in New Jersey’s regulated market and is anticipated to perform equally well in Europe’s fast-growing markets. Enabled by the US casino operator’s brand, US casino property facilities, balance sheet and marketing investment, we anticipate our B2B turnkey services delivered to this US casino operator to contribute material revenue and earnings commencing H1 2017. GAN will also receive a substantial cash payment for divesting legacy B2C intellectual property assets, receivable before year’s end 2016, which completes the strategic B2C Internet gaming divestment process first announced in September 2015. This divestment will position GAN as a B2B-only provider of enterprise grade Internet gaming technology solutions principally serving America’s major casino operators. This contract is a material long term revenue opportunity for GAN and an exciting opportunity for the Client to expand their land-based US gaming operations into the online channel, overseas.”
GAN will provide further detail on the prospects for the Overseas Internet Casino and on the disposal of the B2C assets at the time of the announcement of 2016 first half results on September 30, 2016.
1 Source: Eilers & Krejcik Gaming, LLC August 2016
Launch of Overseas Internet Casino
The Client is a major multi-property casino operator in a regional US gaming market with approximately $1bn in annual land-based gaming revenues. The Overseas Internet Casino will feature the Client’s casino property brand and offer overseas players the ability to engage with GAN’s award-winning real money Internet gaming platform currently powering BetfairCasino.com in New Jersey. High-value International players will be offered the opportunity to accumulate reward points redeemable on-property in the US together with a live dealer casino experience, anticipated to be broadcast from the Client’s flagship US casino property.
Following an extensive diligence process, GAN was selected for its deep and proven capability in providing a custom-designed real money gaming experience wholly integrated into their on-property loyalty program and their casino management system. The Client’s overseas’ regulated Internet casino will operate on GAN’s existing technical and licensing infrastructure deployed in one of Europe leading licensing jurisdictions compliant with the technical and legal requirements of the United Kingdom Gambling Commission.
GAN’s GameSTACK™ Internet gaming system is technically integrated with remote gaming servers from all major Internet gaming content vendors including major US casino equipment manufacturers. Certain online facsimiles of major Class III slot themes and casino table games present in land-based casinos in Europe and other International markets are present within the GameSTACK™ Internet gaming system. Together, the content portfolio available for deployment on the Client’s Overseas Internet Casino represents a unique Internet casino gaming experience designed to appeal to high-value casino patrons who frequent International land-based casinos.
FAQ’s about International Regulated Gaming
International Regulated Gaming markets exclude the United States, Canada and certain other International markets such as Australia, where offering real money Internet gaming to residents is expressly prohibited. Addressable regulated markets for the Overseas Internet Casino represent approximately 30% of the world’s population. The overall European Internet gaming market revenues are forecast to reach USD 16.5bn in 2017 (source: Eilers & Krejcik Gaming, LLC August 2016). Casino gaming is the largest of four principal European product verticals comprising sports, casino, bingo & poker. In the United Kingdom, one of Europe’s largest Internet gaming markets, the UK Gambling Commission reported 55% of gross gaming revenue was derived from the Casino product vertical in the period November 2014 to March 2015. Research estimates suggest the Casino product vertical accounts for 45% of gross gaming revenues in Europe.www.GAN.com
For further information please contact:
| GAN | FTI Consulting | ||
| Dermot Smurfit | Mark Kenny/Jonathan Neilan/Melanie Farrell | ||
| Chief Executive Officer | |||
| +44 (0) 20 7292 6262 | +353 1 6633686 | ||
| dsmurfit@GAN.com | GAN@fticonsulting.com | ||
| Davy | |||
| John Frain / Roland French | |||
| +353 1 679 6363 | |||
Forward Looking Statements
Some statements in this announcement are forward-looking. They represent expectations for the Company’s business, and involve risks and uncertainties. These forward-looking statements are based on current expectations and projections about future events. The Company believes that current expectations and assumptions with respect to these forward-looking statements are reasonable. However, because they involve known and unknown risks, uncertainties and other factors, which are in some cases beyond the Company’s control, actual results or performance may differ materially from those expressed or implied by such forward-looking statements.
GAN | Overview
GAN is a leading developer and supplier of enterprise-level Business to Business gaming software systems and online gaming content. GAN is listed on the ESM Market of the Irish Stock Exchange and the AIM Market of the London Stock Exchange under the tickers GAME and GAN respectively.
The Company has developed an Internet gaming enterprise software system, GameSTACK™, which it licences to online and land-based gaming operators as a turn-key technology solution for both regulated real-money and simulated online gaming. The Internet Gaming System, developed in London under a UK Gaming Commission licence, is certified to the highest technical standards currently required by gaming regulators.
GAN is also a leading developer of proprietary online games with a complementary business converting offline casino slot machines and table games into online equivalents on behalf of major land-based slot machine manufacturers including Aristocrat, Konami, Multimedia Games, Incredible Technologies, GamoMat, Reel Time Gaming, High Flyer Games, DEQ Systems Corp (EZ BACCARAT®) and Ainsworth.
GAN has an established business in Europe, licensing gaming content to UK, Spanish and Italian gaming operators including Bet365, William Hill, Rank, Lottomatica, Sisal MatchPoint and SNAI.
In the United States, GAN has partnered with Betfair Plc to provide its Internet Gaming System following the introduction of regulated real-money online gaming in New Jersey in November 2013. In New York, GAN has launched a Simulated Gaming™ website via www.EmpireCityCasino.com in September 2014. In Pennsylvania, GAN launched a Simulated Gaming™ website www.ParxOnline.com in March 2015 with on-property real money mobile gaming anticipated in 2015. In March 2015 Maryland Live! Casino in Maryland chose GAN to upgrade their existing free-to-play website to a monetized Simulated Gaming™ website, soft-launched in July 2015 and launched integrated with their casino management system in November 2015. In September 2015 major Californian Tribal casino operator San Manuel chose GAN’s Simulated Gaming™ launched in November 2015. In October 2015 American Casino & Entertainment Properties (ACEP) chose GAN’s Simulated Gaming™ launched in December 2015. In December 2015 Borgata Casino Hotel & Spa chose GAN’s Simulated Gaming™ launching in H1 2016. Also in December 2015 Lady Luck Interactive, a wholly-owned subsidiary of Isle of Capri Corporation, chose GAN’s Simulated Gaming™ launching in H1 2016. In February 2016 Rock Gaming (re-branded as Jack Entertainment) chose GAN’s Simulated Gaming™ to support their Ohio-based casino properties launching online in H1 2016. In March 2016 an undisclosed major casino operator in the North East chose GAN’s Simulated Gaming™ launching in H2 2016. In April 2016 major Tribal casino operator Chickasaw Nation chose GAN’s Simulated Gaming™ launching in late 2016. In June 2016 Tribal casino operator TurningStone Casino Resort chose GAN’s Simulated Gaming™ launching in early 2017. In July 2016 an anonymous multi-property commercial casino operator in the United States chose GAN’s Simulated Gaming™ launching in late 2016. In September 2016 an anonymous existing US client of GAN chose to launch real money Regulated Gaming in overseas markets in advance of US regulation, launching in H1 2017.
In March 2016 GAN launched its first virtual reality (VR) Simulated Gaming application containing authentic Class III slot machines compatible with Oculus Rift VR headsets and available to download from New York’s Empire City Casino Simulated Gaming desktop website located at http://play.EmpireCityCasino.com.
GAN will be showing their complete portfolio of real money Regulated Gaming, Simulated Gaming and an ‘early access’ version of their Simulated Gaming VR casino at the world’s largest gaming industry trade show G2E September 26-29 held in Las Vegas. Investors and other interested parties should reach out via hello@gan.com to schedule at visit at GAN’s stand number 1416.
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