Intralot to Buy Bally's International Interactive Unit
Greek gaming company Intralot has announced a new acquisition, reaching an agreement to purchase Bally's international interactive unit in a transaction valued at $3.17 billion. The unit, previously known as Gamesys, was acquired by Bally's in March 2021 for $2.7 billion and represents one of the largest strategic divestitures by the company to date.
LISTEN TO THIS ARTICLE:The deal will be executed through a combination of $1.79 billion in cash and the remaining value in Intralot shares, which are publicly traded on the Athens Stock Exchange. As part of the transaction, Bally's will become a major stakeholder in Intralot, with its ownership increasing from 26.86% to 33.34%.
Related: Intralot and VSC to Pay Hefty Fine for Defrauding DC CouncilThis level of equity ownership has triggered a mandatory tender offer for the remaining outstanding shares of Intralot, in accordance with Greek financial regulations. Intralot has stated that the transaction is expected to close during the fourth quarter of the year, pending customary regulatory approvals and final agreements.
The divestiture of the interactive unit marks a strategic shift for Bally's as it seeks to raise capital for other high-profile ventures. The company is currently engaged in a number of costly development projects, including a $1.7 billion casino development in Chicago, a proposed $4 billion casino hotel in the Bronx, New York, and a pending acquisition of Australia's Star Entertainment.
Bally's is also considering plans for operational rights at the site of the former Tropicana property on the Las Vegas Strip, further emphasizing the need for liquidity.
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Bally's Secures Additional Funding Channels
To support these initiatives, Bally's has secured financial commitments beyond the proceeds of the Intralot transaction. It has arranged a $500 million secured debt facility, which will be combined with the cash received from the sale to repay existing secured debt.
Additionally, Bally's has locked in a $100 million delayed draw debt option that will be available after the transaction closes. These funds are intended for general corporate purposes, including the further development of the Chicago casino project.
By selling the international interactive business, Bally's is not only generating capital but also avoiding the higher borrowing costs associated with accessing debt markets. The company's current credit rating falls deep into speculative-grade territory, which would have led to elevated interest rates on any new financing. Offloading a business that has faced regulatory hurdles in non-US jurisdictions allows Bally's to streamline its operations and concentrate on domestic growth and expansion opportunities.
As part of the deal, leadership changes are also being implemented. Bally's CEO Robeson Reeves will assume the chief executive role at the restructured Intralot and join its board of directors. Current Intralot CEO Nikolaos Nikolakopoulos will lead the company's lottery division as both its president and CEO. Soo Kim, chairman of Bally's board and founder of Standard General, the hedge fund behind Bally's, is also expected to join Intralot's board.
Intralot anticipates that the acquisition will enhance its presence in the iGaming and lottery sectors. The combined total addressable market for these segments is estimated at $187 billion.
The company projects that iGaming will grow at a compound annual growth rate of 14% through 2029, while lottery is expected to expand at a rate of 5% during the same period. The acquisition is intended to position Intralot as a stronger global competitor across digital gaming and lottery verticals.
In parallel to the acquisition, asset management firm Apollo has completed its $6.3 billion acquisition of FinTech provider Everi Holdings and IGT's gaming and digital operations. The new structure will include three business divisions: Gaming, Digital, and FinTech. Apollo has indicated that the Everi name will be retained in specific markets and product lines.
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