Bally’s Corporation completed the sale of its international technology division to Greek lottery operator Intralot S.A. in a merger that positions both companies to expand their global reach.
Key Takeaways
- Bally’s receives a 58% majority stake in the Greek lottery company.
- The “milestone transaction” included €1.53 billion in cash and €1.136 billion of newly issued shares for Bally’s.
- The U.S. gaming and casino operator looks to reduce debt with the funding.
The valued €2.7 billion ($3.2 billion) acquisition was first announced in July and finalized Thursday after Intralot sent €1.53 billion in cash and €1.136 billion of newly issued shares to Bally’s. The transaction, which included a €429-million issue of new ordinary shares Wednesday, gives the U.S. gaming operator 58% equity interest in the Greek gaming company and creates the new Bally’s Intralot.
“This is a milestone transaction for Bally’s,” said Robeson Reeves, Bally’s CEO. “We have unlocked significant liquidity in a key asset while establishing an even stronger platform for digital growth. Our shareholders now have visibility into the value of our interactive division as part of a larger, globally scaled operator.”
Reeves will oversee both companies, as the interactive division’s “leadership, technology stack, and proven digital capabilities” will remain with Bally’s. The merger will take advantage of Bally’s data platform and technology to combine with Intralot’s scale and lottery infrastructure, creating what Bally's called “a powerful foundation for long-term expansion to capitalize on an addressable market estimated to reach €200 billion globally by 2029.”
Putting funds to work
Bally’s, which operates 19 casinos across 11 U.S. states, will see its technology used on a more global scale. It also intends to use at least $1 billion of the post-tax proceeds from the business deal to pay down debt.
A contemplated sale and leaseback of Bally’s Twin River Lincoln Casino Resort in Rhode Island comes with a $500-million application that would reduce debt and help the company maintain ample liquidity following the $670-million revolver to pursue strategic growth.
Bally’s also wants to spend at least $200 million of its newly acquired cash on a Chicago casino development.
Bally’s $4-billion proposal to build a casino project in the Bronx was approved last week by a community committee, putting the company a step closer to landing a coveted New York City gaming license.
U.S. expansion
For Intralot, one of the Athens Stock Exchange’s largest companies, the new venture is expected to generate €1.1 billion in annual revenue. Bally’s also says EBITDA margins in excess of 39% are reachable, “driven by operational synergies, cross-market opportunities, and continued data-driven innovation.”
“Intralot’s lottery expertise and reach, combined with Bally’s International Interactive’s proven digital capabilities, creates a powerful foundation for expansion over the long term,” Reeves said.
Through the merger, Intralot expands even more into the U.S. The company extended its agreement earlier this year to operate the Idaho Lottery for another 10 years. Intralot currently operates regulated gaming in 40 jurisdictions and has been publicly listed since 1992. The gaming company previously operated Type-C sports betting kiosks in Ohio but exited the market earlier this year.
