GAN Limited, a prominent North American iGaming technology provider and sports betting operator, has entered into a definitive Merger Agreement with Sega Sammy Creation, a game development subsidiary of Sega Sammy Holdings. Under the terms of the agreement, GAN will receive $1.97 per share, representing a 121% premium over the closing price of the company’s shares on November 7, 2023.
Seamus McGill, Chairman and Interim CEO of GAN, expressed his satisfaction with the agreement, stating that it presents significant value creation opportunities for shareholders. He cited challenges in the operating environment, including market concentration and slower-than-expected adoption of regulated online gaming in the U.S., as reasons for the merger. McGill believes that Sega Sammy’s ample capital resources make them a strategic fit for GAN.
The Merger Agreement will be presented to shareholders for approval at a Special Meeting of Shareholders to be held no later than March 31, 2024. The completion of the merger is expected in the fourth quarter of 2024, pending approval from gaming regulatory bodies.
Upon shareholder approval, all outstanding GAN ordinary shares will be acquired at $1.97 per share in an all-cash transaction, leading to the company’s privatization. This will mark the completion of the acquisition as a 100% owned subsidiary of Sega Sammy Creation.
The merger has been supported by financial advisor AS B. Riley Securities and legal counsel Sheppard Mullin Richter & Hampton for GAN, and SMBC Nikko Securities and Greenberg Traurig for Sega Sammy.
The acquisition of GAN by Sega Sammy Creation will see the integration of GAN’s innovative software solutions, such as GameSTACK™, into the Sega family, enabling their implementation in consumer and arcade games, gaming machines, and hotels and casino resorts operated by Sega Sammy Holdings.
The impact of the merger was immediately evident, with GAN shares doubling in pre-market trading upon the announcement. This surge comes after a recent 94% increase in GAN shares, indicating positive market response to the acquisition.
Overall, the merger between GAN and Sega Sammy Creation represents a significant step for both companies, with the potential to drive innovation and growth in the iGaming and gaming technology sectors.