Smurfit's GAN ditches sales process and eyes expansion

SHARES in GAN, an Irish company which develops and sells B2B gambling software and gaming content, soared as much as 31pc yesterday after it said it has terminated a sales process and will now seek a stock market listing in the US.

The firm, headed by Dermot Smurfit, has a market capitalisation of about £74m (€83m).

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It said trading in the eight months to the end of August has been “significantly ahead” of expectations, helping to spur the shares to their highest level in about five years.

In March, GAN announced it was starting a strategic review of the business to maximise value for shareholders.

It said at the time the process could include a possible sale of the firm, or seeking an investor to take a non-controlling stake in it.

“The purpose of the formal sales process was to explore the merits of the group remaining as an independent organisation, relative to the alternative options available to the group,” it said yesterday.

GAN said it received “multiple bids from multiple parties” during the sales process.

“In the context of the company’s rapid and accelerating growth year-to-date and growth trajectory of the business moving forwards, the company’s board of directors, in consultation with its advisers, has determined that the bids received did not represent fair value for shareholders,” it said.

“As a result, the board has concluded that it is unlikely that the formal sales process would produce the most attractive outcome from the review of strategic alternatives,” it added.

“The board has therefore decided to terminate the formal sales process.”

The company will seek a US listing “as soon as reasonably practicable”.

Releasing interim results yesterday, GAN said it generated revenue of £11.3m (€12.7m) in the first half of 2019, a 145pc year-on-year increase. Earnings before interest, tax, depreciation and amortisation (ebitda) were £3m. It made an ebitda loss of £300,000 in the first six months of 2018.

Mr Smurfit said the cash on GAN’s balance sheet will be used to “selectively grow development resources” in Sofia and Las Vegas to take advantage of the growing number of US states which are expected to regulate online gambling in the near future.

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