Transaction Expands Gambling.com Group’s
Addressable Market with Recurring Revenue From Consumer
Subscription Products and Enterprise Clients
Gambling.com Group, (Nasdaq: GAMB) (“Gambling.com Group” or the
“Company”), a fast-growing provider of digital marketing services
for the global online gambling industry, announced today it entered
into a definitive agreement to acquire Odds Holdings, Inc., the
parent company of OddsJam. Under the terms of the agreement, Odds
Holdings stockholders will receive initial consideration of $80
million and may receive up to an additional $80 million based on
Odds Holdings’ business performance through the end of 2026.
Gambling.com Group’s acquisition of Odds Holdings further expands
the Company’s online gambling industry footprint, adding
complementary recurring revenue from new and existing users and
partners.
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the full release here:
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Gambling.com Group to acquire Odds
Holdings, parent company of OddsJam, a superior technology platform
offering real-time odds data (Graphic: Business Wire)
Odds Holdings is powered by a state-of-the art technology
platform for real-time odds data and offers services under multiple
consumer and enterprise brands. Gambling.com Group believes the
odds platform is the industry’s most advanced and delivers data to
end-users with the lowest latency. The platform is built for scale,
processing on average over one million requests per second and
multiple terabytes of data per day, across nearly 300 sportsbooks.
OddsJam is the flagship brand offering premium, real-time odds
information to empower sports bettors to make data-driven bets
through a consumer facing website and app. Under a separately
managed company, Odds Holdings also provides low latency,
comprehensive odds data to enterprise clients for a variety of
sports betting use cases.
Closing is expected to occur on January 1, 2025 and is subject
to customary closing conditions. The transaction will be
immediately accretive to Gambling.com Group’s operating results
upon closing. For 2024, Odds Holdings expects to generate revenue
and Adjusted EBITDA(1) of approximately $26 million and $12
million, respectively. Gambling.com Group expects that under its
management Adjusted EBITDA(1) derived from the Odds Holdings assets
will grow by at least 20% in 2025. The Odds Holdings team,
including OddsJam founders Ankit Goyal and Alex Monahan as well as
CEO, Matt Restivo, will join Gambling.com Group.
Strategic and Financial Rationale
- Expands the Company’s footprint in the online gambling
ecosystem with new recurring revenue from both consumer and
enterprise clients;
- Opportunity to leverage Gambling.com Group’s existing partner
relationships to significantly grow the Odds Holdings enterprise
business;
- Immediately accretive transaction adds new revenue, Adjusted
EBITDA and free cash flow streams, with a margin profile even
better than Gambling.com Group’s already high margins; and,
- Is a strategic and substantial step toward the Company’s stated
goal to generate $100 million in annual Adjusted EBITDA(1). (1)
Represents a non-IFRS measure. See “Non-IFRS Financial Measures” at
the end of this release.
“The accretive acquisition of Odds Holdings will immediately
provide Gambling.com Group with additional, recurring revenue
streams which are independent of our market-leading online gambling
affiliate business, consistent with our strategy to expand our
footprint in the online gambling industry,” said Gambling.com Group
co-founder and CEO, Charles Gillespie. “We are delighted to welcome
the Odds Holdings team to Gambling.com Group as we accelerate
growth towards our goal of $100 million in Adjusted EBITDA. Their
talented team has not only built a state-of-the art odds technology
platform, but managed to build multiple distinct products on top of
that platform which have very clear product-market fit. Odds
Holdings gives Gambling.com Group a suite of new enterprise
products while OddsJam in particular brings a passionate and
energetic new consumer audience to the Group.
“We have achieved the vast majority of our growth through
organic market share gains, while also successfully executing on
several strategic, accretive acquisitions that have contributed to
our consistently improving financial performance. Our acquisitions
of RotoWire, BonusFinder and Freebets.com have proven that we can
leverage our high free cash flow to identify, acquire and
accelerate growth, creating value for our shareholders, while
prudently managing our capital structure and balance sheet,” added
Gillespie.
“Combining with a tech-focused leader in the global online
gambling industry like Gambling.com Group is the natural next step
for Odds Holdings,” said Odds Holdings CEO, Matt Restivo. “By
leveraging Gambling.com Group’s expertise, innovation and resources
we will be optimally positioned to scale our technology and
data-driven insights to reach an even larger audience of online
bettors, including beyond the North American market. We’re looking
forward to working with the Gambling.com Group founders Charles and
Kevin and their team to create a deeper connection with our
customers to enhance their online gambling experiences,” said
OddsJam founders Ankit Goyal and Alex Monahan.
Proposed Transaction Structure & Expansion of Credit
Facility
The initial $80 million purchase consideration will be comprised
of $70 million in cash and $10 million in Gambling.com Group
ordinary shares. The Company expects to fund the $70 million cash
payment from borrowings under the Company’s expanded credit
facility, as described below. In order to fully achieve the
additional $80 million in contingent consideration, Adjusted EBITDA
derived from the Odds Holdings assets needs to at least double for
the full year 2026 period compared to 2024. Entirely at the
Company’s discretion, Gambling.com Group has the ability to settle
up to 50% of any of the contingent consideration payments in the
Company’s ordinary shares.
In conjunction with the transaction, the Company entered into a
debt financing commitment letter with Wells Fargo Bank, National
Association and Wells Fargo Securities, LLC, which have committed
to arrange and provide a senior secured term loan and revolving
credit facility of at least $100 million pursuant to an amendment
to its existing credit agreement.
In connection with the proposed transaction, White & Case
LLP is acting as legal counsel to Gambling.com Group. Oakvale
Capital LLP is acting as the sell-side financial advisor and
Cruz-Abrams Seigel LLC is acting as legal counsel to Odds
Holdings.
About Gambling.com Group
Gambling.com Group Limited (Nasdaq: GAMB) (the “Group”) is a
fast-growing provider of digital marketing services for the global
online gambling industry. Founded in 2006, the Group has offices
globally, primarily operating in the United States and Ireland.
Through its proprietary technology platform, the Group publishes a
portfolio of premier branded websites including Gambling.com,
Bookies.com, Casinos.com, and RotoWire.com. Gambling.com Group owns
and operates more than 50 websites in seven languages across 15
national markets covering all aspects of the online gambling
industry, including iGaming and sports betting, and the fantasy
sports industry.
About OddsJam
OddsJam provides a suite of tools and services designed to
assist in sports betting. It offers a comprehensive odds comparison
tool, allowing users to compare real-time odds from over 100
sportsbooks. Additionally, OddsJam includes a Positive EV Betting
Tool to identify profitable betting opportunities, an Arbitrage
Betting Tool for spottingarbitrage opportunities, and a Parlay
Builder for creating custom parlay bets. The platform also features
a Fantasy Optimizer for PrizePicks, optimizing selections for daily
fantasy sports. OddsJam aims to make profitable sports betting
accessible by providing data and analytics to inform betting
strategies.
Non-IFRS Financial Measures
Management uses several financial measures, both IFRS and
non-IFRS financial measures in analyzing and assessing the overall
performance of the business and for making operational
decisions.
EBITDA and Adjusted EBITDA
EBITDA is a non-IFRS financial measure defined as earnings
excluding interest, income tax (charge) credit, depreciation, and
amortization.
Adjusted EBITDA is a non-IFRS financial measure defined as:
in relation to the Company, EBITDA adjusted to exclude the
effect of non-recurring items, significant non-cash items,
share-based payment expense, foreign exchange gains (losses), fair
value of contingent consideration, and other items that the
Company’s board of directors believes do not reflect the underlying
performance of the business, including acquisition related
expenses, such as acquisition related costs and bonuses; and
in relation to OddsJam, EBITDA adjusted to exclude the effect of
non-recurring items, significant non-cash items, share-based
payment expense, foreign exchange gains (losses), fair value of
contingent consideration, capitalized development expenses,
non-recurring payments to shareholders and other items that the
Company’s board of directors believes do not reflect the underlying
performance of the business, including acquisition related
expenses, such as acquisition related costs and bonuses.
The Company and OddsJam believe Adjusted EBITDA is useful to
their management teams as a measure of comparative operating
performance from period to period as this measure removes the
effect of items not directly resulting from core operations
including effects that are generated by differences in capital
structure, depreciation, tax effects and non-recurring events.
While the Company uses Adjusted EBITDA as a tool to enhance its
understanding of certain aspects of its financial performance, the
Company does not believe that Adjusted EBITDA is a substitute for,
or superior to, the information provided by IFRS results. As such,
the presentation of Adjusted EBITDA is not intended to be
considered in isolation or as a substitute for any measure prepared
in accordance with IFRS. The primary limitations associated with
the use of Adjusted EBITDA as compared to IFRS results are that
Adjusted EBITDA as the Company defines it may not be comparable to
similarly titled measures used by other companies in its industry
and that Adjusted EBITDA may exclude financial information that
some investors may consider important in evaluating our
performance.
The forward-looking Adjusted EBITDA guidance included in this
press release has not been reconciled to the most directly
comparable forward-looking IFRS measures because this cannot be
done without unreasonable effort due to the lack of predictability
regarding the various reconciling items.
Cautionary Note Concerning Forward-Looking Statements
Cautionary Note Concerning Forward-Looking Statements. This
press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
Section 21E of the Securities Exchange Act of 1934, as amended, and
the safe harbor provisions of the U.S. Private Securities
Litigation Reform Act of 1995, that relate to our current
expectations and views of future events. All statements other than
statements of historical facts contained in this press release,
including statements relating to our further expansion of our
footprint in the online gaming ecosystem, our acquisition of
OddsJam and the closing of such transaction; whether OddsJam will
achieve the expected growth and financial results described in this
press release, our expected leverage following the initial purchase
consideration in connection with such transaction, and whether we
can achieve $100 million in annual Adjusted EBITDA are all
forward-looking statements. These statements represent our
opinions, expectations, beliefs, intentions, estimates or
strategies regarding the future, which may not be realized. In some
cases, you can identify forward-looking statements by terms such as
“believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,”
“should,” “plan,” “expect,” “predict,” “potential,” “could,”
“will,” “would,” “ongoing,” “future” or the negative of these terms
or other similar expressions that are intended to identify
forward-looking statements, although not all forward-looking
statements contain these identifying words. Forward-looking
statements are based largely on our current expectations and
projections about future events and financial trends that we
believe may affect our financial condition, results of operations,
business strategy, short-term and long-term business operations and
objectives and financial needs. These forward-looking statements
involve known and unknown risks, uncertainties, contingencies,
changes in circumstances that are difficult to predict and other
important factors that may cause our actual results, performance,
or achievements to be materially and/or significantly different
from any future results, performance or achievements expressed or
implied by the forward-looking statement. Important factors that
could cause actual results to differ materially from our
expectations include that the conditions to the completion of the
acquisition of OddsJam may not be satisfied; that the Company may
be unable to achieve the anticipated benefits of the acquisition of
OddsJam; that the financial results and growth of OddsJam following
the merger may be lower than expected; that costs related to the
transaction and operating and integration costs following the
acquisition of OddsJam may be greater than expected; that the
Company may assume unexpected risks and liabilities and may face
challenges related to integration and to the preparation of
required financial statements following the transaction with
OddsJam; that the Company may be unable to motivate and retain its
management and the OddsJam team following the transaction, and that
completing the merger may distract the Company’s management from
other important matters; and the other factors discussed under
“Item 3. Key Information - Risk Factors” in Gambling.com Group’s
annual report filed on Form 20-F for the year ended December 31,
2023 with the U.S. Securities and Exchange Commission (the “SEC”)
on March 21, 2024, and Gambling.com Group’s other filings with the
SEC as such factors may be updated from time to time. Any
forward-looking statements contained in this press release speak
only as of the date hereof and accordingly undue reliance should
not be placed on such statements. Gambling.com Group disclaims any
obligation or undertaking to update or revise any forward-looking
statements contained in this press release, whether as a result of
new information, future events or otherwise, other than to the
extent required by applicable law.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241212903186/en/
For further information, please contact:
Investors: Peter McGough, Gambling.com Group,
investors@gdcgroup.com Richard Land, Norberto Aja, JCIR,
GAMB@jcir.com, 212-835-8500 Media: Eddie Motl, Gambling.com
Group, media@gdcgroup.com
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