Gaming Innovation Group (GiG) purchased a majority stake in local online gaming with hopeful Top Games on the Croatian market.
The Stockholm-listed GiG reported on Tuesday that it has signed a stock buying agreement to purchase 75% of Top Games d.o.o., which GiG claims is “qualifies” for a license to operate remote gambling in Croatia. The remaining 25% of Top Games will be “retained by the local partner who has a successful history in land-based casino business.”
The intention for this “collaborative partnership model” is to launch one of GiG’s in-house brands in Croatia, with both parties participating in the ongoing local operations of the unspecified online casino brand, pending regulatory approval.
The transaction does not include any cash exchanging hands, with compensation of this purchase consisting solely of “a contribution of resources by the shareholders.” GiG will demonstrate brand rights, gambling infrastructure and operational experience, while its local partner will bear the initial costs.
GiG expects its Croatian release to take place in the first half of 2020, with a moderate impact on the company’s H2 2020 revenue followed by “accelerated increase in revenue contribution” from H1 2021 onwards. At the announcement, investors largely shrugged, with GiG’s shares closing Tuesday’s trading slightly more than 1%.
There are currently six online casinos operating locally in Croatia paying 15 percent tax on their gross revenue from gaming. Richard Brown, acting CEO of GiG, called Croatia a “very interesting marketplace for gambling” to further expand GiG’s B2C operations and the company’s strategy of “grow our own brands in high-potential and regulated markets.”
Regulated markets have not always been so successful for GiG, which closed its Swedish-facing online sportsbooks in July due to concerns that the country’s betting laws are “too open to interpretation.” In August, GiG announced a 16 percent year-on-year fall in its Q2 revenue, partly due to its limited Swedish market struggles.
By shutting down its proprietary game studio, which generated “negligible” revenues, GiG tightened its belt in September.