XLMedia to sell European and Canadian gambling assets to Gambling.com Group

Gambling.com will pay up to $42.5m.

UK.- The affiliate group XLMedia has announced that it has entered into a binding agreement to sell its European and Canadian sports betting and gaming assets to Gambling.com Group for up to $42.5m. Gambling.com will pay a fixed $37.5m and a potential earnout of up to $5m based on performance.

The assets being sold include Freebets.com, WhichBingo.co.uk, Nettikasinot.com and Vedonlyonti.com along with smaller sites. The fixed sum of $37.5m will be paid in cash across three instalments, with the initial $20m payable on completion, which is expected for April 1. A further $10m will be payable at six months and $7.5m plus any earnout on the first anniversary of completion.

Marcus Rich, chair of XLMedia, said: “The board believes the sale of these assets, which is approximately two times the current market capitalisation of the whole company, is an excellent outcome for XLMedia and its shareholders. Importantly, this transaction will allow the company to clear legacy liabilities, provide working capital and return cash to shareholders.”

XLMedia estimated the revenue and adjusted EBITDA attributable to the assets in 2023 to be $21.4m and $6.6m respectively. As of March 20, 2024, the total consideration for the deal represents around 200 per cent of the group’s market capitalisation. XLMedia will incur transition costs for six months for the migration of technology and will retain cash, debtors and liabilities.

It said it will use the proceeds of the sale to cover the asset transition costs, pay its final deferred US acquisition payment, settle outstanding tax provisions and provide working capital to support its business in North America as well as to return cash to shareholders.

Last year, XLMedia sold three European casino affiliate sites to Beach Services. It sold Casino.se, Casino.gr and Casino.pt, targeting Sweden, Greece and Portugal, for $4m.