Raketech is to significantly expand its presence in the US and India sports betting markets after agreeing to acquire QM Media AB’s assets.
Through the deal, worth €16m ($18.8m/£13.7m) and set to complete in September, iGaming marketing group Raketech will acquire Stockholm-headquartered QM Media’s North American subsidiary, P&P Vegas Group Inc, including flagship betting tips channel PicksandParlays. The acquisition also includes India-facing cricket site OnlineCricketBetting.
As a result of the acquisition, Raketech’s revenues originating from the US are expected to approximately double and the Indian revenues to reach 5-10% of the group’s total by Q4 2021. Furthermore, Raketech’s sports vertical is expected to reach approximately 30% of the group’s total revenues in Q4 of this year.
Raketech said the acquisition of Ohio-headquartered P&P Vegas will establish its presence in North America, with existing employees to switch to the new owner on completion of the deal. PicksandParlays has been established for more than a decade and attracts around half a million unique monthly users, generating income through subscriptions and sale of tips. Raketech said it will seek to monetise its existing commercial relationships with major US sports book operators, generating additional growth through traditional affiliation.
OnlineCricketBetting reaches more than one million unique users during major events such as the Indian Premier League (IPL). Raketech said the acquisition will not only lead to a significant position within affiliation of cricket betting, but also take a leading position in the Indian market. In addition to the cricket assets, a portfolio of sports assets targeting the Nordics is part of the acquisition.
Oskar Mühlbach, chief executive of Raketech said: “With these acquisitions we are delivering on several strategically important goals. Significant sports revenues, revenues from high growth markets, boots on the ground in the US and asset diversification and new revenue streams.
“Furthermore, by adding such a strong brand as PicksandParlays, Raketech will be able to add significant value to the US business through the implementation of the affiliate marketing sales in all licensed states. And with the talented and committed team that comes with the acquisition, I am very much looking forward to having them join forces with our central operations team to accelerate growth even further.”
The agreed purchase price amounts to €16m on a cash and debt free basis which will be settled in a cash payment of €9m and an issuance of 3,881,968 new Raketech (RAKE) shares amounting to €7m. The number of Raketech shares issued has been determined by the volume-weighted RAKE share price 30 trading days up until 5 July 2021. The purchase price represents a multiple of approximately 5.6x EBITDA and 3.8x revenues for the last 12 months.
Marcus Egstam, chief executive of QM Media, said: “By partnering with Raketech we gain access to their well-established infrastructure that will help leverage our strong brands and market positions. We are enthusiastic to become shareholders in Raketech and to be a part of the exciting future we have planned.”
