Online gaming entertainment and solutions provider 888 has acquired, via its 888 US and 888 US Holdings subsidiaries, the remaining 53 per cent interest in All American Poker Network (AAPN) for US $28m. 888 described the acquisition as an important strategic milestone that will facilitate the group’s future growth strategy in the US. “The acquisition gives the group full flexibility to deliver on multiple potential growth opportunities including developing new strategic partnerships,” it said.
The AAPN joint venture was established between Avenue Capital and 888 in March 2013 to launch 888’s B2C brands in the regulated online gaming market in the US. Since November 2013, the 888poker and 888casino brands have been operating in New Jersey.
The Transaction will give 888 independent control of its growth strategy in the US moving forward. This strategy includes signing new partnerships and continuing to deploy its proprietary products and technology (both B2B and B2C) in new states as they regulate. Over recent months, 888 has also further strengthened its position in the US with the September launch of 888sport in New Jersey alongside its established poker and casino brands. It was the first time that the firm had offered sports betting in the US and paves the way for the group to launch 888sport in additional US states as future regulation allows.
The company also signed a landmark sponsorship agreement with the New York Jets of the National Football League (“NFL”), marking the first such agreement between an NFL team and a pure-play online gaming operator.
Itai Frieberger, Chief Executive of 888 commented: “The acquisition of the remaining stake in AAPN is an important strategic step towards 888 achieving its exciting long-term potential in the US. Taking outright ownership of AAPN gives 888 additional operational, technological and commercial flexibility to develop innovative and exciting new partnerships and launch in new states – through both B2B and B2C channels – as and when future regulation allows. This acquisition places 888 in an even better position to take advantage of the significant growth opportunities in the US and create additional value for our shareholders.
The AAPN joint venture has been a very successful endeavor for the group. It has afforded us the flexibility and financial capability to build a position in the regulated US market over the last five years whilst also investing in other global regulated markets. I would like to thank Avenue Capital for being fantastic partners in this venture since 2013.”
The consideration of US $28m will be satisfied all in cash, with US $10m being paid to the Sellers on or about the date of this announcement and the remainder of US $18m to be paid by 31 March 2019.