Kindred Acquires Outstanding Shares of Relax Gaming, At EV of €320M


Nasdaq Stockholm Large Cap listed online gambling operator Kindred Group is to acquire the remaining 66.6 percent outstanding shares in Maltese B2B iGaming supplier Relax Gaming.

The transaction, whose close is conditional to customary regulatory approvals and is expected to be completed in the fourth quarter of 2021, values Kindred at up to €320m on a cash and debt free basis (Enterprise value).

Thanks to the acquisition, Kindred, which has been invested in Relax Gaming since 2013, plans to increase its focus on product and customer experience.

Founded in 2010, Relax Gaming is a B2B iGaming software supplier that designs and develops online casino games, supported by an open distribution platform for third party aggregation as well as proprietary poker and bingo products. The company currently has approx. 240 full-time employees with four main offices in Malta, Estonia, Sweden and Serbia. In the last twelve months leading up to May 2021, Relax Gaming generated revenues of approximately €25m with an EBITDA of approximately €10m.

The company currently supplies poker and bingo content on an exclusive basis to Kindred along with casino content. The deal is expected to generate annual run-rate synergies of €8m within the next three years for the Kindred group driven by lower investment needs and reduced cost of sales. Kindred plans to keep Relax Gaming as an independent entity within the Group with a separate Board of Directors and management team as wel as to continue to invest in the company to strengthen its position as a B2B iGaming supplier, enhancing its product offering and broadening the B2B customer base.

All existing employee share option programs in Relax Gaming will be exercised, and the company’s management will retain an ownership of approx. 6 percent of total fully diluted shares in it as Kindred’s ownership in Relax Gaming will be approx. 93 percent after the completion of the transaction and the exercise of the options.

Led by Henrik Tjärnström, CEO, Kindred Group is an online gambling company which operates 9 brands and doing business across Europe, Australia and USA. The company, which employs about 1,600 people, is a member of the European Gaming and Betting Association (EGBA) and founding member of IBIA (International Betting Integrity Association). It is audited and certified by eCOGRA for compliance with the 2014 EU Recommendation on Consumer Protection and Responsible Gambling (2014/478/EU).

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Kindred will pay an initial consideration, settled in cash upon completion, of approximately €80m (on a cash and debt free basis). In addition to the initial consideration, the maximum earn-out payments amount to €113m and may become payable in 2022 and 2023, subject to Relax Gaming achieving certain earnings thresholds. The transaction will be financed through Kindred’s existing cash and credit facilities.