Playtech Acquires Online Bingo Developer Virtue FusionFebruary 15, 2010 8:47 am
Gaming software development company Playtech Ltd has consolidated its hold on the bingo market by acquiring leading internet bingo products developer and licensor Virtue Fusion. Playtech has payed £29 million for the company, with a further £7 million consideration due by 2011 depending on the company’s performance.
Virtue Fusion currently operates more than twenty bingo sites in the UK including Mecca Bingo, Ladbrokes Bingo, Virgin Bingo and Crown Bingo. The company enjoys up to 6,000 UK customers at a time and in 2008, generated £12.3m of revenue (£3.8 million EBITDA). Following the acquisition of Virtue Fusion, its CEO Bob McCulloch said:
“We are delighted to be a part of Playtech. This deal will ensure our operators continue to benefit from the market leading VFA Bingo product and in addition can now profit from Playtech’s greater international reach and access to a wider games portfolio.”
Playtech’s acquisition of the company is seen as an attempt to strengthen its position in online gaming’s fastest growth area of 2009, and commenting on the deal Playtech CEO Mor Weizer said:
“The acquisition places Playtech in the leading position in international online bingo markets, complementing our leading position in poker and casino and, following the GTS acquisition, as a content provider. It reflects our ongoing commitment to provide licensees with a comprehensive portfolio of best of breed gaming products.”
“In a number of newly regulated markets, bingo is an embedded part of the social and gaming culture and a product which finds early favour with regulators. Consequently we see this acquisition as not only furthering what is already Playtech’s competitive advantage in the growing online gaming market as a whole, but as having the potential to generate meaningful opportunities in newly regulated markets.”
“We believe that the acquisition of Virtue Fusion creates value for Playtech shareholders and the board anticipates the transaction will be earnings accretive in 2010 and beyond. ”
The news of the acquisition was received well by the market and Playtech Limited shares are currently trading up +6.50p or 1.39% on the day at 474.00p.