Scientific Games, one of the world’s leading lottery technology providers, announced Friday that has agreed to acquire Bally Technologies for $5.1 billion. The acquisition comes in the form of a purchase of all of Bally’s outstanding common stock at $83.30 per share, as well as the refinancing of $1.8 billion in Bally debt.
In a press release issued Friday, Scientific Games’ President and Chief Executive Officer Gavin Isaacs (former head man at Bally) expressed his excitement, saying:
The acquisition of Bally provides us with a unique opportunity to combine two exceptional companies with long track records of creating leading-edge games and gaming technology products for players and delivering innovative solutions to our customers. With leading gaming, lottery, and interactive content, world-class systems capabilities and table game offerings, we believe that the combined company will be uniquely positioned as a strategic partner for gaming and lottery operators, offering a highly diversified suite of value-enhancing products and services across multiple worldwide distribution channels and platforms.
Bally Technologies originally started out as a pinball machine manufacturer about 80 years ago, but soon began producing slot machines. Ever since, it has become one of the leaders in casino gaming technology, supplying slots, table games, and gaming systems to casinos around the world. The company also holds a special place in United States gaming history, as it was the first firm to receive an online gaming license in the regulated Nevada market back in June 2012.
In February 2013, Bally Technologies and Amaya Gaming signed a memorandum of understanding, agreeing to integrate Amaya’s Ongame poker platform into Bally’s igaming suite. The previous September, Bally Technologies had partnered with American Casino and Entertainment Properties, LLC (ACEP), the owner of the Stratosphere in Las Vegas, to serve as ACEP’s online poker technology provider. To date, they have not launched an online poker room in Nevada.
Bally CEO Richard Haddrill also weighed in on the merger, saying:
The combination with Scientific Games will benefit our customers and shareholders. Increased scale, geographic diversity and product development capabilities will create a new runway of growth opportunities through new products and a comprehensive portfolio of customer-focused solutions. This transaction delivers immediate value to our shareholders, and the highest share price in our history. We look forward to working with our new colleagues at Scientific Games to execute a detailed integration plan to realize customer satisfaction and additional value.
Isaacs also emphasized that this business deal will benefit shareholders of the combined company. “Reflecting both organizations’ recent post-merger integration successes,” he said in the press release, “we have identified and expect to realize $220 million in annual cost synergies and $25 million of annual capital expenditure savings by the end of the second year following the closing of the transaction.”
This is the second major acquisition by Scientific Games in the last two calendar years. In January 2013, it announced the purchase of WMS Industries, a leading gaming machine and interactive gaming content provider, for $1.5 billion. While now part of the same company, the two still operate as separate brands.
