In its growth strategy, affiliate marketing giant Raketech hailed a significant achievement by acquiring the US-facing affiliate site American Gambler, thus ramping up its igaming focus by selling off its assets in consumer finance.
For a fee of EUR 5 m ( £ 4.5m/$ 5.9 m), American Gambler will be bought, reflecting a 3.9x multiple of the expected profits of the company for 2020, and 3.5x its estimated sales. It will also take control of many local state assets as part of the agreement, which will ramp up investments to further accelerate growth.
Raketech noted that, through the acquisition, US sales will hit between 5 percent and 10 percent of full-year revenue by 2020.
Raketech chief executive Oskar Mühlbach said: “The acquisition of American Gambler is an important strategic move for us, shifting the US from a strategic target to a strategic market.
“And by expanding the American Gambler’s service offering to more and more states with the support from our strong core operations team and technology platform, I foresee great opportunities for growth.”
American Gambler founder Alexander Kostin said the best choice for his company was to join forces with “a larger professional player with a proven track record.”
“With this partnership American Gambler have secured both financial muscles and a strong infrastructure in order to become one of the leading brands on the US market,” Kostin said. “I am happy that Raketech identified the potential in American Gambler and gave a helping hand to realise its full potential for years to come.”
The purchase fee, along with the financing generated from the sale of Raketech’s consumer finance assets, will be settled using cash on hand.
ROI Media UK will buy these, for a total consideration of EUR 4.2 million. Raketech noted that this was consistent with its method of concentrating on igaming.
The sale prices of EUR 4.2 million, it said, reflected a multiple of 4.3x EBITDA, based on the performance of the assets over the past year, which will be broken down into a front fee of EUR 3.4 million, then EUR 0.8 million charged over the next 18 months.
“The divestment of the consumer finance assets is an important and natural step for us to ensure sharp focus on igaming,” Mühlbach explained. “Furthermore it gives us additional ammunition for growth through M&A – where we see high potential – on strategic markets such as the US.
“In only a few years we have managed to grow our finance assets into one of the key portfolios within its niche, on the Scandinavian market, but I am confident that ROI – with its dedication to the Financial affiliation market – is the right partner to take the assets to the next level.”
Massive Friday at Raketech! Firstly we announced a giant step into the US market with the acquisition of https://t.co/Y4gtihUhqo, secondly, we have divested our Finance vertical to achieve 100% iGaming focus. This more than ever makes us the Igaming Performance Marketing Partner.
— Raketech (@RaketechGroup) November 6, 2020