Australia-based slot machine manufacturer Ainsworth Game Technology Ltd (ASX:AGI) said on Monday it had completed a private-held, U.S.-based asset acquisition of MTD Gaming Inc. The purchase was made by their wholly-owned U.S. subsidiary, Ainsworth Game Technology Inc., the parent company said in a statement.
According to Monday’s filing, the Ainsworth group charged an “initial purchase price” of US$ 13 million, with an additional US$ 13 million deferred payment payable “on the successful delivery of financial targets and contract renewals.
Ainsworth chief executive Lawrence Levy was quoted in the document as saying: “We are delighted to welcome MTD to Ainsworth. The acquisition marks another positive step in transitioning Ainsworth to growth and improved profitability.”
In Monday’s filing, MTD Gaming was identified as a proven developer and supplier” of poker, keno and video-reel content for use in multiplay and video lottery terminal (VLT) markets. Management of Ainsworth noted that game items from MTD Gaming were “highly complementary” to “existing game suite” from Ainsworth.
Mr Levy was quoted as saying that the company’s acquired games were “a great fit” with Ainsworth’s “existing Class II and Class III offerings on the U.S. market,” and noted that the acquisition followed the global launch in February of the new line of Ainsworth slot machine cabinets, known as the A-Star range.
Ainsworth CEO added: “We expect to drive incremental revenues by offering these proven and highly successful games to customers in our established markets where Ainsworth operates, including California and Nevada.”
Monday’s filing confirmed that all requisite closing conditions had been “completed,” allowing Ainsworth “to target these products utilising the acquired assets throughout selected and established licenced jurisdictions.” The Australia-listed company said that the transaction would be financed by existing debt facilities and cash reserves. The deal had been expected to be earnings-accretive in the first year post completion,” it said.
Ainsworth posted a net loss of AUD4.0 million (US$ 2.6 million) a fortnight ago for its first half of fiscal year ended December 31. In a commentary following the first half of fiscal results, CEO Mr Levy said that the company was “making progress” in implementing steps–including innovation in game technology and new product development–”to deliver improved results.”