Online casino operator LeoVegas has announced that its LeoVentures subsidiary has acquired a 51% majority stake in GameGrounds United AB, owner of the CasinoGrounds.com streaming website network.
LeoVegas will pay an initial purchase price of SEK 30m, with a potential additional maximum earn–out payment of SEK 15m which is based on the revenue performance of the acquired assets during the period January-June 2018. LeoVegas has stated that based on their current assessment, the full earn-out payment will be made.
The agreement between the two companies also includes an option to purchase an additional 29% of the shares in 2021-2022 at five times the operating profit of the acquired business. The acquisition is set to close 1st January 2018.
GameGrounds United AB operates the Casino Grounds site, a casino streaming platform and social casino forum which can be accessed via YouTube and Twitch. During the third quarter of 2017, CasinoGrounds United reported revenue of SEK 4.1m.
In a statement announcing the deal on the LeoVegas website, LeoVegas' Group CEO, Gustaf Hagman, said: "In CasinoGrounds we see a new behaviour in which persons interested in casino are watching others play casino via YouTube and Twitch. CasinoGrounds has created a new niche through its live streaming and social platform, which are highly appreciated by players.
“The combination of proprietary content and the moving picture format create exciting opportunities going forward and is in line with LeoVegas' strategy to be an innovative and entrepreneur-driven company. LeoVegas has had successful cooperation with CasinoGrounds since 2016, and we know their team well. Our ambition is now to scale up existing operations to more markets."
This deal is LeoVegas’ second major acquisition in months, following the conclusion of an agreement to acquire the Royal Panda brand from Maltese company Web Investments Limited for €100m.