Ainsworth buys MTD Gaming asset in deal valued US$26mln
Australia-based slot machine maker Ainsworth Game Technology Ltd said on Monday it had completed an asset acquisition of privately-held, U.S.-based MTD Gaming Inc. The acquisition was done via its wholly-owned U.S. subsidiary, Ainsworth Game Technology Inc, said the parent company in a filing.
The Ainsworth group paid an “initial purchase price” of US$13 million, with an additional US$13 million of deferred consideration payable “on the successful delivery of financial targets and contract renewals,” according to Monday’s filing.
The document quoted Ainsworth chief executive Lawrence Levy as saying: “We are delighted to welcome MTD to Ainsworth. The acquisition marks another positive step in transitioning Ainsworth to growth and improved profitability.”
MTD Gaming was described in Monday’s filing as a “proven developer and supplier” of poker, keno and video-reel content for use in multi-game and video lottery terminal (VLT) markets. Ainsworth’s management noted that MTD Gaming’s game products were “highly complementary” to Ainsworth’s “existing game suite”.
Mr Levy was quoted as saying that the acquired firm’s games were “a great fit” with Ainsworth’s“existing Class II and Class III offerings in the U.S.” market, and noted the deal followed the global launch in February of the Ainsworth brand’s new line of slot machine cabinets, known as the A-Star range.
“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,” added the Ainsworth CEO.
Monday’s filing stated that all necessary closing conditions had “been completed,” enabling Ainsworth “to target these products utilising the acquired assets throughout selected and established licensed jurisdictions.”
The Australia-listed company said the acquisition would be funded by existing debt facilities and cash reserves. The deal was “expected to be earnings-accretive in the first year post completion,” it added.
Ainsworth reported a fortnight ago a net loss of AUD4.0 million (US$2.6 million) for its fiscal first half ended December 31. CEO Mr Levy said in commentary accompanying the first-half fiscal results that the firm was “making progress” in implementing measures – including investing in game technology and new product development – “to deliver improved results”.
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