Everi to acquire bingo company Video King

Reaction has been positive to Everi purchasing a majority of privately owned electronic bingo gaming device and systems provider Video King’s assets for $59m.

The acquisition should close within 60 days funded from existing cash on hand and is subject to net working capital adjustments and closing conditions.

The assets should be immediately additive to adjusted EBITDA and free cash flow, elevate EVRI’s existing offering and offer another avenue of growth, CEO Randy Taylor said.

Video King generated revenue of more than $25m last year, mostly from recurring revenue from its installed base of more than 50,000 portable electronic bingo tablets in tribal and commercial casinos, bingo halls, military bases and cruise lines.

Video King’s assets will expand the addressable market for Everi’s digital gaming content and 20 per cent of Video King’s installed base of portable tablets may be enabled to provide traditional bingo games and Class II video poker, slots and instant win games, as well as digital wallet and loyalty products.

This could be bigger to Everi than at first blush, worth $1.25 per unit per day, and Video King is likely to be paid a flat monthly rental fee with a small component of percentage of game play, David Bain of B Riley said.

Everi could incorporate proprietary content and capture EBITDA for each device as players could enjoy newer, faster games than electronic bingo, he said.

Jeffrey Stantial of Stifel sees this as the acquisition of a stable, nice business at a reasonable valuation with optionality to cross-sell.

Truly complementary acquisition on the games side of Everi’s business are limited and the company has done well to continue broadening the addressable market in a disciplined way, he said.

Barry Jonas of Truist said the acquisition fits with Everi’s strategy and will allow the company to compete in a relatively underserved e-bingo market.

Source: Fantini’s Gaming Report