Gambling.com Group, a digital marketing services provider for the global igaming industry, has entered into an agreement with Edison Partners regarding a $15.5m investment into the equity of the group through an issuance of new ordinary shares and an acquisition of existing ordinary shares in the group.
$6.975m of that total will be satisfied by the issuance of 2,291,543 new ordinary shares in the group. The remainder will be satisfied through a sale of existing ordinary shares in the group by an existing shareholder.
The group said it intends to use the proceeds from the transaction for general corporate purposes with a view to accelerating certain investments in the US market. The transaction also includes a warrant agreement whereby Edison can elect to invest an additional $3m into the group under the same terms between seven and 12 months post-closing.
The transaction is expected to close prior to October 15, 2019. Upon completion, Edison Partners will own approximately 18.66 percent of the ordinary shares in Gambling.com Group.
According to Gambling.com, the agreement represents one of the most significant deals between a US private equity fund and a performance marketing company focused on online gambling and sports betting. The firm added that it expects the US market to grow in size to rival that of the current European one in the coming years.
Chief Executive Charles Gillespie noted: “We greatly look forward to bringing on Edison as our teammate in our new American journey. Edison is the right partner at the right time, and I expect our collaboration to deliver powerful results. Their investment in the group validates our thesis that we are the performance marketing and content platform best positioned to benefit from the expansion of regulated online gambling in the United States.”
In a statement, the company said that the addition of Edison Partners to its list of investors gives the group a strategic American growth equity partner that will help advance its objectives, particularly in its home state of New Jersey and throughout its network in the northeastern US.
“We are thrilled to enter the online gaming market with our investment in Gambling.com Group,” said Chris Sugden, Managing Partner at Edison Partners. “The company will continue to monetize the large market opportunity in Europe while increasing investment in the US. Online gaming is expanding significantly as regulations are modified on a state-by-state basis.”
The group added in its statement that it has been executing a comprehensive plan to be the leading performance marketing company within the regulated online gambling sector in the US since before the invalidation of PASPA in May 2018.
Its flagship website Gambling.com is already active in New Jersey and Pennsylvania, and the group is investing substantial resources in Bookies.com to make it the pre-eminent source of sports betting information in the US.
The group has secured licenses to expand business deals with gambling operators in New Jersey, Pennsylvania and West Virginia and has broadened its footprint with key management hires, a new office in Charlotte, North Carolina, and by becoming the first sports betting media group to be accepted as members of the Associated Press Sports Editors (APSE).
“Attention to sports gambling in the US is booming, and we are building out a robust content team, offering products to match that interest,” Gambling.com Group Director of North American Content Gerry Ahern said. “On Bookies.com we are providing a real-time lens for sports fans that educates, entertains and informs them as they explore legal wagering options. On Gambling.com we are keeping the audience up to date with industry news and the latest in legislation as more states come online and more fans are served.”
Gregg Michaelson, Partner at Edison Partners, will sit on the company’s board of directors after the transaction closes. He commented: “With an exceptionally strong brand, robust content creation strategy, player-focused editorial point of view and proven marketing capabilities, Gambling.com Group is well positioned to become the leading provider of new customers to US-based online sportsbook and igaming operators.”