Aristocrat Leisure Buys NeoGames in $1.2B Deal

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Aristocrat Leisure, one of the world’s biggest slots makers, has bought North American online lottery provider NeoGames for $1.2 billion.

That purchase values NeoGames at $29.50 per share, which is around 104% above the stock’s average over the last three months.

“We are pleased to have reached this agreement, which we believe benefits all of NeoGames’ shareholders, as well as our various stakeholders,” said NeoGames’ Board of Directors Chair John Taylor Jr. in a joint statement.

Related: Our expert fan guide to the best Aristocrat slots

Aspiring Purchase

The $1.2 billion offer was unanimously accepted by NeoGames board and shareholders. It now awaits the expected regulatory approval.

Once approved, NeoGames will cease as a publicly listed company and become a wholly owned subsidiary of Aristocrat. The deal is expected to close within the next year.

Australian slots developer Aristocrat has been one of the biggest names in slots for decades across the online and land-based casino markets.

Last year, it ended its long interest in buying fellow game developer Playtech in a deal that could have cost $2.7 billion. Instead, it has now opted to buy lottery specialists NeoGames. Online lotteries have a small market share compared to casino gaming and sports betting. But it is a sector that is steadily growing in the US.

NeoGames operates online lottery services in four US states – Michigan, New Hampshire, North Carolina, and Maryland. It is looking at or currently negotiating contracts in half a dozen more legal states.

It recently released its 2023 Q1 report, revealing it earned a revenue of $64.3 million in the first three months of the year. That’s up 187% on the figures from the same period in 2022. Lottery revenues rose 8% year-on-year to $14.4 million.

NeoGames also bought out Aspire Global for $480 million in 2022. Aspire is a global business to business casino and gaming platform provider, with some world-leading clients, such as Entain, Flutter, William Hill, and 888.

Diversifying Core Casino Business

“We do see a vote of confidence in Aristocrat opting to diversify outside of the core casino business into iLottery,” said financial adviser Jeffrey Stantial of Stifel, an investment bank who advised NeoGames throughout the deal.

The online lottery sector in North America could see more innovation and new games as a result of this deal and NeoGames’ integration into the casino gaming fold.

Aristocrat could also leverage Aspire Global’s client to expand its relationships with the world’s biggest operators.

“We are delighted that the team at Aristocrat recognizes the significance of what we have built, and the strategic opportunity to combine our complementary businesses,” said NeoGames CEO Moti Malul.

“I am tremendously proud of our entire team at NeoGames, as together we have established our leadership position, driving our success across ilottery, igaming, and online sports betting.”

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