NPT.L Regulatory News (NPT)

2 Jan 2009 07:00



Date: 2 January 2009

On behalf of: NetPlay TV plc ("NetPlay TV", "the Company" or "the Group)

Embargoed until: 0700hrs

NetPlay TV plc

Acquisitions of Venturygames.co.uk & Toucanwin.com

Strategic Partnership with Zed Worldwide

Acquisition of mobile quiz business

NetPlay TV plc (AIM: NPT), the interactive gaming company, is pleased to announce the acquisitions of Venturygames.co.uk, and Toucanwin.com, the mobile gambling and skill gaming businesses of Info-download Limited, a subsidiary of Zed Worldwide, S.A ("Zed"), a leading developer of entertainment and community products and services for mobile and the internet. Zed currently operates in 54 countries with forecast revenues for 2008 of over $800m, generated by over 49m users. NetPlay TV has also signed an exclusive two year sales agreement with Zed to sell the NetPlay TV range of interactive gaming solutions to its 130 plus Mobile Network Operator client base worldwide.  

Venturygames.co.uk is a provider of casino, bingo entertainment products and services for mobile phone users. Users can download games direct to their mobile allowing them to interact and place bets whilst on the move. Today it operates solely in the UK and has a relationship with Mobile Network Operator, O2, a Telefonica subsidiary. The business has grown rapidly over the past few months with the value of bets placed currently exceeding £400,000 per month. 

Gambling on mobiles has always been a key part of NetPlay TV's gaming strategy and the Directors believe this acquisition will help accelerate the convergence of the Company's products across the different platforms. Over the past year, the Company's mobile revenues have increased significantly with over £400,000 in gross mobile revenues being generated in October 2008. The strengthened partnership with Zed will allow the Company to exploit Zed Worldwide's relationships with Network Operators, allowing the operators to profit from their mobile subscribers gambling on NetPlay TV's products on other platforms as well as mobile, such as TV and internet. The Directors believe this is a unique and powerful proposition.

Toucanwin.com was established by Zed Worldwide several months ago to exploit the growing "skill" gaming business. It is widely recognised that allowing people to challenge each other in games of skill for a cash prize is an excellent medium in countries where gambling is not allowed. Toucanwin.com takes 10 per cent of the monies wagered as its margin for providing the service. NetPlay TV believes that skill gaming is an important area of growth in markets where gambling cannot be promoted. 

As part of these transactions, NetPlay TV will also acquire the UK mobile quiz business, "Grab a Grand" from Info-download Limited. Currently the weekly quiz has over 11,000 subscribers who play for a chance to win cash prizes, as well as a £1 million draw. 

The businesses acquired as part of this transaction currently generate monthly gross revenues of circa £500,000. Revenue growth has been extremely aggressive increasing by over 200 per cent in fewer than six months. These acquisitions will allow the Company to take on board the revenues of Info-download Limited without incurring the vast majority of costs relating to the businesses, as such the Directors believe this transaction will be immediately earnings enhancing.

The consideration payable by NetPlay TV for the assets is £1 million, to be satisfied in full by the allotment and issue by NetPlay TV of 3,846,153 ordinary shares of 5 pence each at a pre agreed price per share of 26p. 2,884,615 shares were issued at completion and a further 961,538 will be issued on 31 March 2009 in order to cover any potential warrant claims. The shares will be subject to a 12 month hard lock-in and an orderly market agreement thereafter.

NetPlay TV has also entered into two strategic partnerships with Zed Worldwide. The first two year partnership allows Zed to sell the converged interactive gaming solutions of NetPlay TV's products to their extensive client base of over 130 Mobile Network Operators in 54 countries. NetPlay TV is now able to offer a number of complete solutions to partners from skill gaming, to Bingo and to its Supercasino offering. All of these products offer a mobile, Internet and TV solution allowing mobile customers to also participate via the Internet and TV. Zed Worldwide has over 130 Mobile Network Operator relationships including a five year exclusive deal with Telefonica, one of the largest mobile operators globally.

The second one year strategic relationship with Zed, allows NetPlay TV to exploit the mobile development skill base of Zed Worldwide. Zed has over 200 full time mobile developers. This relationship enables NetPlay TV to integrate its offerings with the mobile much quicker than it had previously expected. A complete converged solution allowing the user to interact from one single wallet via any device further strengthens the Group's position. 

Zed Worldwide currently owns 13,250,000 shares in NetPlay TV plc. As such, under the AIM Rules for Companies, Zed Worldwide is treated as a related party of Netplay. The Directors of Netplay consider, having consulted with Panmure Gordon (UK) Limited, Netplay's nominated adviser, that the terms of the acquisition are fair and reasonable insofar as its shareholders are concerned. This transaction will increase Zed Worldwide's total holding post 31 March 2009 to 17,096,153 shares or 13.76 per cent of the enlarged business.

Martin Higginson, Executive Chairman and Chief Executive Officer, said:

"We are extremely pleased to be working closer with the team at Zed Worldwide. The mobile platform is an important part of our converged plan, and as such adding their mobile gambling business to ours strengthens this position further. Having access to the Zed mobile developers will enable us to develop integrated mobile applications much quicker and therefore give the consumer greater choice of which device he or she accesses our gaming services from.

"Adding skill gaming with the acquisition of www.toucanwin.com brings another business unit to our portfolio, allowing us to offer every form of gaming to the consumer from games of skill to bingo to full blown "live" casino games. As we move forward, we will offer all of these services via multiple access points from mobile to Internet to TV. The signing of this deal will also allow us access the millions of Zed users as well as their network of Mobile Network Operator relationships. 

"This is another milestone in the growth of our business, this acquisition increases Zed's stake in our business and such reaffirms their belief in our goal to continue building a truly converged global interactive entertainment business." 

Javier Dolset Perez - CEO of Zed Worldwide said: 

"Some months ago we took a strategic stake in NetPlay TV as we believe in their vision. Selling these assets to NetPlay TV allows Zed to take what we have built and integrate it with NetPlay TV's strong portfolio of games. This strategic partnership enables both companies to increase growth and offer gaming solutions to our customers worldwide. Combined with access to our vast network of customers and MNO relationships, this will assist NetPlay TV's goal to build a global entertainment business. " 

-Ends- 

Enquiries:

NetPlay TV plc

Martin Higginson, Executive Chairman www.netplaytv.plc.uk 

Via Redleaf

Redleaf Communications Tel: 020 7566 6700

Sanna Sumner netplay@redleafpr.com

Panmure Gordon

Andrew Burnett Tel: 0151 243 0986

Katherine Roe Tel: 020 7459 3600

Stuart Gledhill

Zed Group www.zed.com 

Miguel López-Quesada

General Manager Corporate Communication & 

Institutional Affairs 

Via Mantra PR

Mantra PR (PR Advisers for Zed Group) Tel: 020 7438 4939

Andrew Griffiths  Mobile: 07971 479 285agriffiths@mantra-pr.com

Notes to Editors:

Publication photographs are available from Redleaf Communications or www.redleafpr.com

About NetPlay TV plc

NetPlay TV plc is listed on the AIM market of the London Stock Exchange (NPT). NetPlay TV operates a number of interactive gaming services under a UK gaming license, including 'Live Roulette' ™ and 'Live BlackJack, www.supercasino.com, 'Live Roulette' and 'Autowheel' can also be viewed live on television on Sky Channel 866. 'Live BlackJack' is broadcast live on the Internet www.supercasino.com from 9pm. 

In April 2008, NetPlay TV acquired Bingos.com, an established pan-European online bingo operator with over one million registered players. Bingos.com currently operates as an Internet site in the UK, Spain, Italy, Poland and Sweden.

The Company is focused on the delivery of a converged interactive gaming experience allowing its customers to interact with its games on a variety of platforms, TV, Internet and mobile from a common integrated wallet.

About Zed Worldwide

Zed Worldwide develops and markets entertainment and community products and services for mobile and the Internet. The company is the leading mobile value-added player in the world in terms of revenue and geographical footprint. Zed operates in 54 countries, including Europe's largest markets, USA, Latin America and China. Zed Worldwide holds agreements with more than 130 mobile network operators and employs 1,400 staff.

Founded in 1996 in Spain, the company's history is characterised by the ongoing development of innovative services in the entertainment and leisure arena for mobile and Internet, and it remains at the forefront of the industry. 

The Zed Group also includes a videogames development arm (Pyro Studios) and a theatrical animation studio (Ilion Animation Studios).