GAN selected by existing US casino client to launch real money Regulated Gaming in Europe
$1.4m up-front cash payment, multi-year marketing commitment with material income participation for GAN
London & Dublin | September 12, 2016: GAN plc (“GAN” or the “Company”), an award-winning developer and supplier of enterprise-level B2B Internet gaming software, services and online gaming content in the United States, announces it has extended an existing partnership with a major US casino operator (the “Client”) to launch an International overseas real money Internet casino gaming website and mobile App (the “Overseas Internet Casino”). The new website and App are expected to launch in H1 2017 and will target Europe and other International regulated gaming markets outside the US under a seven year contract with the Client.
GAN’s first US Casino client to extend partnership into overseas’ regulated Internet gaming markets
GAN selected following an extensive due diligence process based on its deep and proven capability in providing a custom-designed real money gaming experience integrated into an on-property loyalty program and casino management system
GAN to receive an up-front $1.4m cash payment for intellectual property assets and development services following completion of customary due diligence and regulatory approvals – expected in Q4 2016
Launch of the Overseas Internet Casino will be supported by a minimum user acquisition marketing budget wholly funded by the Client: $10m per annum over the term of the seven year contract
GAN to participate materially in the net income generated by a unique Internet casino offering principally targeting a growing European Internet gaming market which is forecast to reach a value of $16.5bn in 20171
The Overseas Internet Casino is expected to launch online in H1 2017 and will be integrated into the Client’s on-property rewards program - the first International real money Internet casino offering non-US resident players access to a major US casino’s exciting rewards program.
Dermot Smurfit, CEO of GAN commented: “GAN’s unique casino product is performing strongly in New Jersey’s regulated market and is anticipated to perform equally well in Europe’s fast-growing markets. Enabled by the US casino operator’s brand, US casino property facilities, balance sheet and marketing investment, we anticipate our B2B turnkey services delivered to this US casino operator to contribute material revenue and earnings commencing H1 2017. GAN will also receive a substantial cash payment for divesting legacy B2C intellectual property assets, receivable before year’s end 2016, which completes the strategic B2C Internet gaming divestment process first announced in September 2015. This divestment will position GAN as a B2B-only provider of enterprise grade Internet gaming technology solutions principally serving America’s major casino operators. This contract is a material long term revenue opportunity for GAN and an exciting opportunity for the Client to expand their land-based US gaming operations into the online channel, overseas.”
GAN will provide further detail on the prospects for the Overseas Internet Casino and on the disposal of the B2C assets at the time of the announcement of 2016 first half results on September 30, 2016.
1 Source: Eilers & Krejcik Gaming, LLC August 2016
Launch of Overseas Internet Casino
The Client is a major multi-property casino operator in a regional US gaming market with approximately $1bn in annual land-based gaming revenues. The Overseas Internet Casino will feature the Client’s casino property brand and offer overseas players the ability to engage with GAN’s award-winning real money Internet gaming platform currently powering BetfairCasino.com in New Jersey. High-value International players will be offered the opportunity to accumulate reward points redeemable on-property in the US together with a live dealer casino experience, anticipated to be broadcast from the Client’s flagship US casino property.
Following an extensive diligence process, GAN was selected for its deep and proven capability in providing a custom-designed real money gaming experience wholly integrated into their on-property loyalty program and their casino management system. The Client’s overseas’ regulated Internet casino will operate on GAN’s existing technical and licensing infrastructure deployed in one of Europe leading licensing jurisdictions compliant with the technical and legal requirements of the United Kingdom Gambling Commission.
GAN’s GameSTACK™ Internet gaming system is technically integrated with remote gaming servers from all major Internet gaming content vendors including major US casino equipment manufacturers. Certain online facsimiles of major Class III slot themes and casino table games present in land-based casinos in Europe and other International markets are present within the GameSTACK™ Internet gaming system. Together, the content portfolio available for deployment on the Client’s Overseas Internet Casino represents a unique Internet casino gaming experience designed to appeal to high-value casino patrons who frequent International land-based casinos.
FAQ’s about International Regulated Gaming
International Regulated Gaming markets exclude the United States, Canada and certain other International markets such as Australia, where offering real money Internet gaming to residents is expressly prohibited. Addressable regulated markets for the Overseas Internet Casino represent approximately 30% of the world’s population.
The overall European Internet gaming market revenues are forecast to reach USD 16.5bn in 2017 (source: Eilers & Krejcik Gaming, LLC August 2016). Casino gaming is the largest of four principal European product verticals comprising sports, casino, bingo & poker. In the United Kingdom, one of Europe’s largest Internet gaming markets, the UK Gambling Commission reported 55% of gross gaming revenue was derived from the Casino product vertical in the period November 2014 to March 2015. Research estimates suggest the Casino product vertical accounts for 45% of gross gaming revenues in Europe.
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