Bally Technologies, the U.S. marker of gaming machines and casino-management systems, said on Thursday it had acquired Israel’s Dragonplay for a price that could reach $100 million.
Bally said it would pay $51 million in cash for Dragonplay, an online casino operator based in Tel Aviv. Bally said it would pay as much as another $49 million over the next 18 months to keep key employees and if Dragonplay meets certain financial performance targets.
“We expect this strategic acquisition to help position Bally at the forefront of social casino gaming by leveraging our world-class content, including proprietary table games and award-winning video slots, on Dragonplay’s increasingly popular social casino,” said Bally CEO Richard Haddrill. “Dragonplay has proven remarkable foresight and leadership in the mobile space.”
Formed in 2010 with an initial investment of just $650,000 by a group of private investors, Dragonplay has about 700,000 active daily users, putting it among the world’s top 10 game developers in revenue terms in the social casino market.
Its Live Hold’em Pro, which it launched in 2011, is No. 1 in its card games category. Dragonplay has also developed technology that enables players to send text messages to each other, which they do at a rate of millions of messages a month.
Dragonplay developed its games for Google’s Android platform but it also has offerings on Facebook and for Apple’s iOS.
In the 12 months through the end of March, Dragonplay generated $10 million in earnings before interest, taxes, depreciation and amortization, Bally said. If so, the valuation it put on Dragonplay was relatively conservative, at just 10 times EBITDA.
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