GGRAsia – Sci Games seeks up to US$405mln via social gaming biz IPO

Sci Games seeks up to US$405mln via social gaming biz IPO

Apr 23, 2019 Newsdesk Industry Talk, Latest News, Top of the deck

Scientific Games Corp, a United States-based casino equipment maker and lottery services company, announced on Monday the start of an initial public offering of a minority interest in its social gaming arm, SciPlay Corp.

The goal is to float the shares on Nasdaq in the United States, under the ticker symbol “SCPL”.

SciPlay is offering 22 million shares of its class A common stock. The initial public offering price is expected to be between US$14.00 and US$16.00 per share, said the parent company in a press release.

“SciPlay expects to grant the underwriters a 30-day option to purchase up to an additional 3.3 million shares of its class A common stock at the initial public offering price,” the release added.

The document did not include a schedule for the completion of the overall exercise.

If SciPlay is able to sell all the shares on offer – including those granted to the underwriters – at the top end of the price range set for the IPO, the company would realise US$404.8 million in gross revenue.

The announcement issued on Monday said the lead book-runners for the SciPlay offering were BofA Merrill Lynch, JP Morgan Securities LLC and Deutsche Bank Securities Inc. In addition, Goldman Sachs & Co LLC, Morgan Stanley & Co LLC, Macquarie Capital (USA) Inc and RBC Capital Markets LLC were acting as book-running managers for the offering. Co-managers for the IPO were announced as Stifel, Nicolaus & Company Inc, and Wedbush Securities Inc.

Scientific Games reported in February that it made a net profit of US$206.8 million in the fourth quarter of 2018, having made a net a loss of US$43.1 million a year earlier. Fourth-quarter revenue rose by 7.6 percent year-on-year to US$885.7 million.

On Monday, Scientific Games provided a set of estimated preliminary results for its social gaming business segment for the first three months of 2019. It said it expected to record revenue of between US$117 million and US$119 million during the period, as compared to US$97.5 million in the first quarter of 2018. Net income for the social gaming business was expected to range between US$13 million and US$15 million, compared to a net loss of US$1.1 million in the prior-year period.

Scientific Games had said in November it had been considering an IPO for a minority interest in its social gaming business. “The social gaming business continues to experience rapid growth and has reached significant scale,” the firm stated at the time.