UK based 32Red announced its acquisition of Roxy Palace Online Casino for an amount totalling £8.4 million this week. According to details released by 32Red, the company will pay £2 million in cash and issue 10 million new shares to cover the expense.
Roxy Palace is a long standing Microgaming software powered online casino which was established in 2002 and while it has remained a relatively small operation in comparison to other online casino groups, it still has in excess of 230,000 registered players.
According to reports, Roxy Palace reported net revenue of £10.1 million in the year ending 31 December 2014, with gross profit figures totalling £3.4 million. EBITDA totalled £1.6 million in 2014.
32Red’s acquisition of Roxy Palace will be facilitated by the use of Eucalyptus Investment’s issued share capital and once the deal has been executed, 32Red will take ownership of the casino’s intellectual property rights, player databases and information.
32Red’s CEO Ed Ware commented that the company was delighted with the purchase of Roxy Palace and believed that the move would benefit both their existing and new shareholders. He further pointed out that the companies shared a number of mutual values, making them a good fit for one another and furthering 32Red’s growth strategy in regulated markets.
While full details of what the acquisition will mean for existing Roxy Palace players and affiliates has not been disclosed, the integration is expected to be completed quickly and smoothly without any issues. This will not however necessarily be the case for existing Roxy Palace employees and job losses down the line seem to be inevitable.
Following the Roxy Palace acquisition announcement, 32Red confirmed that it would be releasing its trading update for the first half of 2015 on the 22nd of July, and with its share prices increasing since the acquisition announcement, the second half of 2015 looks bright for the organization.
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