MGM-backed Playstudios goes public via former MGM CEO-led SPAC | Yogonet International
The merger with Acies Acquisition Corp. values the social casino game developer at $1.1B

MGM-backed Playstudios goes public via former MGM CEO-led SPAC

Acies’s Chairman is Jim Murren, former Chief Executive Officer of MGM. MGM will own about 10% after its additional investment.
2021-02-02
United States
Reading time 2:31 min
Playstudios’ founder and CEO Andrew Pascal, who will continue in that role, is a former Wynn Las Vegas President. Institutional investors include BlackRock, Neuberger Berman Funds and MGM Resorts, and they are putting $250 million into the business. The new company will seek to acquire other companies and games.

Playstudios Inc., an online game operator backed by MGM Resorts International, announced Monday it is going public via a $1.1 billion merger with a special purpose acquisition company (SPAC).

The Las Vegas-based business, which offers free-to-play online blackjack and slot-machine games such as myVegas Slots and myVegas Blackjack, said it’s combining with Acies Acquisition Corp., a shell company founded last year. Acies’s chairman is Jim Murren, former chief executive officer of MGM. He has a noncompete agreement with MGM that precludes him from entering into businesses related to “gaming facilities” that expires March 22. Talks about the Playstudios deal were first reported by Bloomberg last week.

Playstudios’ founder and CEO Andrew Pascal, former Wynn Las Vegas President, will continue in that role with the new company. He is also a co-founder and adviser to Acies. Playstudios shareholders will receive $150 million in cash and own about 64% of the shares of the new entity. Institutional investors are putting $250 million into the business. Those investors include BlackRock Inc., Neuberger Berman Funds and MGM Resorts, which offers perks like free rooms to Playstudios players to build loyalty. MGM will own about 10% after its additional investment.

Pascal told Bloomberg he will use the money raised through offering to grow the business: “We’ll now have the currency and capital to go acquire other companies and games.

“Within today’s vast and growing games market, Playstudios is unique in offering their audience the opportunity to play for fun and earn for real. They know how to make engaging and enduring games, and stand apart in having harnessed the power of a robust and full-featured loyalty program,” Murren said in a press release. “The focus is now to take Playstudios platform and super-charge its growth. We have abundant initiatives, including targeted, strategic acquisitions; an expansion of the rewards program into new categories such as sports entertainment; and the exploration of opening the playAWARDS platform under a loyalty-as-a-service model. We look forward to leveraging Acies’ M&A knowledge and broad relationships for the benefit of Playstudios and its shareholders.”

Playstudios' products allow customers to purchase an in-game currency to continue playing and reach higher levels, as with most social online games. Playstudios’ twist is that they simultaneous earn points in the company’s own loyalty program, which can be traded in for real-world prizes like tickets to shows or discounted meals. Users of the playAwards loyalty program can redeem points at 17 MGM properties, including the Bellagio, Aria, MGM Grand, Luxor and Mandalay Bay. 

During the lockdowns, the global market for social casino games grew 24% from the previous year to nearly $7 billion last year, faster than the overall mobile-gaming growth rate of 18%, according to a report by Eilers and Krejcik Gaming. Their analysts predict the social-casino market will reach $8.6 billion by 2025. Out of the top 15 social casino companies, Playstudios ranked 8th with an estimated $274 million in revenue last year, according to the report.

The deal is expected to close in the second quarter of 2021. The combined company will be named Playstudios and remain listed on the Nasdaq under the symbol MYPS. Acies co-CEOs are Dan Fetters and Edward King, former managing directors at Morgan Stanley.

SPACs like Acies pool cash and then strike deals with businesses looking to go public without the uncertainty of an IPO. Mobile-gaming company Skillz and sports-betting firm DraftKings both went public last year via SPAC deals. Golden Nugget Online Gaming and Rush Street Interactive also went that route recently.

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