Gamenet and rival Goldbet fuse into new Italian betting giant Gamenet Group

Gamenet Group, listed on the STAR segment of the Mercato Telematico Azionario organized and managed by Borsa Italiana S.p.A. announces that Gamenet S.p.A., a wholly-owned subsidiary of the Issuer, has signed a binding contract for the acquisition of 100% of the share capital of GoldBet, an authorized gaming and betting company in Italy.

GoldBet operates a physical network of 990 betting shops and also holds the concession for the collection of "online" games and bets, even including mobile platforms. GoldBet ended 2017 with EBITDA1 of US47 million, EBIT US40 million,  Net Income of US27 million and estimates an EBITDA2 for the period of 12 months ended June 30, 2018 of approximately US58 million.

The value of the Acquisition is US310 million (enterprise value), to be adjusted with the value of the net financial position, as defined in the contract, as of June 30, 2018. Of this amount, US280 million, adjusted with the value of the net financial position referred to above, will be paid in cash on the date of completion of the Acquisition, expected by the end of the third and beginning of the fourth quarter of 2018, while US32 million will be paid subsequently, as deferred price components over a medium-term period, subject to the occurrence of certain conditions provided for in the acquisition contract.

The Acquisition will allow Gamenet Group to assume a leading position in Italy in the multi-concession gaming sector, particularly in the sports betting sector, and to significantly increase the degree of diversification of its product portfolio and profitability, at EBITDA, EBIT and Net Profit levels. Based on the data of the first 6 months:

- the combined entity would be the first betting operator in Italy, with an overall market share of about 18% (21% in sports betting on the physical network, 7% in online betting and
33% in virtual betting).

From the integration of GoldBet, significant cost synergies are envisaged, which are expected to reach, on an annual base, approximately Euro 12-15 million in the period 18-24 months after the closing date, as well as significant synergies in terms of revenues, particularly virtual betting.

The positive effects of the Acquisition of GoldBet on Gamenet Group’s 2018 EBITDA guidance are not yet estimated, as they depend on the Closing date, namely the date of the first consolidation of GoldBet. The acquisition of GoldBet will be financed through recourse to debt for the portion of the price due at closing. To this end, the Company has obtained the commitment of UniCredit and Nomura for the organization and underwriting of a committed bridge aimed at paying the price. The commitment of the credit institutions is subject to the usual conditions precedent for this type of transaction, including specifically the conditions precedent to the completion of the acquisition indicated below.
The bridge loan may also be refinanced through a transaction in the debt capital markets, depending on
market conditions.

The Closing is subject to the occurrence of the usual conditions precedent for this type of transactions, including the approval of the Competition Authority and the authorization of the Customs and Monopolies Agency. "Through this strategic transaction, Gamenet Group" - commented Guglielmo Angelozzi, Chief Executive Officer of the Group - "makes, after the acquisition of the Italian assets of Intralot Group in 2016, a further significant dimensional leap, which allows to assume a leading position in the gaming sector in Italy, particularly in the sports betting sector in which the Group will have the largest sports betting network in the country, with over 1,700 points of sale, to acquire a significant presence in the online segment, to further diversify the business mix and to significantly improve the profitability. Just over 6 months from the listing on the STAR segment, we are preparing to complete an important operation that
further strengthens our leadership in Italy and transforms us into an operator of European importance, determined to seize all future growth opportunities, thanks to skills and passion of our over 770 employees.”

"This transaction represents a major opportunity for the two companies and will allow us to exploit the synergies and know-how of both companies. I am happy to be part of this project, ensuring continuity, but at the same time developing new projects for an ambitious joint growth," commented Paola Bausano, CEO of GoldBet.