he consideration for the acquisition of GTS comprises an initial amount of approximately 10.8 million euros and further consideration based on the profitability of the GTS business over the next two years capped at 21.6 million euros. The initial amount has been financed from Playtech’s existing cash resources.
GTS provides its gaming solutions to some of the most well established gaming companies in Europe. It has agreements with 15 licensees and 30 separate internet gaming brands, including many of the well known large European Sportsbooks, along with Bingo and Casino operators. Of these, there are more than 10 well established operators not currently Playtech casino licensees.
GTS has developed its Enhanced Gaming Engine (EdGE) open gaming platform which provides access to products from a diverse range of game developers and content providers. The platform is highly regarded for its cutting edge functionality and flexible connectivity. This greatly aids the ability of an operator to fully integrate a player’s wallet into one account across all games and products. EdGE also facilitates rapid delivery of new content across multiple languages, currencies and domains and games can be delivered as browser-based or downloadable client products.
GTS has partnered with 19 games content providers with 200 integrated fixed odds, virtual sports, table games and slots from a combined catalogue of well over 500 games. Many incorporate recognised brands, rich feature functionality and graphics which help develop considerable player loyalty. The games are created internally or sourced from GTS’s established network of third party game developers across the world, which EdGE is able to seamlessly integrate.
For Playtech, the acquisition brings a highly regarded open platform, a range of games which complement its own core in-house products, and an enhanced product pipeline. The combination will produce a very substantial games selection library for operators for both casino and soft games. EdGE can be integrated within Playtech's class-leading Integrated Managed Solution (IMS) player management system and as such can substantially increase an operator's capacity for cross-selling onto higher margin products.
GTS has a strong track record of games integration and has enjoyed considerable recent growth. For the 12 month period ended June 2009, GTS recorded revenues of us$ 4.2 million and adjusted PBT of £0.3m, before amortisation of intangibles of us$ 2.9 million.
Playtech's CEO, Mor Weizer commented: “We are delighted to welcome the GTS team which will enhance our capabilities in an important complementary product area by bringing a sophisticated technology platform and a portfolio of top quality games as well as suite of new clients. The success of the games sections in sports betting operators sites is evident and this deal will give Playtech greater exposure to what is one of the fastest growing industry segments. GTS has amongst its licensee base many of the most well established European sportsbetting operators and we look forward to developing closer ties with them.
“This is an important strategic acquisition for us and reflects our commitment to provide a comprehensive range of innovative gaming products. We are positioning Playtech as the independent software provider of choice with market leading integrated technology and a complete portfolio of best of breed gaming products. We see this deal as furthering what is already Playtech's competitive advantage in the growing online gaming market.”
Steven Matsell, GTS's Business Development Director added: “GTS’s strategy is very much in line with Playtech’s - to be the recognised market leader as a dedicated B2B software provider. This deal will underpin the growth of the platform and we very much look forward to the future as part of the Playtech team.”