iGaming Daily

Ted OC (00:02.586)
Hi everyone, welcome to iGaming Daily. So this week is shaping up to be quite a big one for the gaming sector. As ever, the unstoppable force that is mergers and acquisitions in this industry is showing no signs of slowing down in 2025. So what we've seen this week is that Intralot, the Greek multinational B2B tech firm, has signed a transaction agreement with Balles, the big US conglomerate. Obviously everyone, I'm sure all our listeners know who Balles are.

which will see it take over Bali's iCasino Technology Division, Bali's Interactive International. So we're just gonna talk about what does this mean for Intralot, what does this mean for Bali's, and what does this mean for the gaming sector overall. So I'm Ted Orme Clay. As usual, I'm joined by Ted Memier to have a chat about this topic on the iGaming Daily podcast sponsored by Optimove. Ted.

How's it going? You alright? I think I was on leave last week, so it's been a while since I've been in the studio with you. How's things been?

Ted Menmuir (01:05.154)
Good, good, good to be back from, I had a short break abroad and came back to news of kind of more &A plays in the industry, so pretty standard.

Ted OC (01:16.896)
Yeah. Where did you go? Abroad by the way, Ted, I never asked.

Ted Menmuir (01:20.594)
in Barcelona then we drove up to Provence and my god Europe is boiling it is very very dry out there so to our audiences make sure you are putting on your suntan lotion

Ted OC (01:37.019)
Yeah, I was in Greece and that can give a similar review. Yeah, that was roasting hot as well. Lovely place though, great food, great drink, great people. Yeah, Actually, yeah, I've not even. Yeah, yeah, yeah, I didn't even clock that. Thanks, Ted. So yeah, subtly and smoothly introduced by myself on the topic of Greece, Intralot.

Ted Menmuir (01:39.061)
Ooh. Ooh.

Ted Menmuir (01:47.246)
It's a good good connect to this story by the way we did not yeah we did not work that one in.

Ted OC (02:05.042)
a Athens stock exchange listed company, one of the bigger betting and gaming tech firms from Greece, of course, secured this deal this week, quite a big one. So what does this mean for Intralot, Ted? How significant a moment is this for the company? Because obviously from the outset, looking at this, it seems like this is quite a big expansion of their technology capabilities. They've talked a lot about what their ambitions are following it. But yeah, from your perspective and what you've seen on it, how big a moment is this?

Ted Menmuir (02:35.134)
This is huge for interlock.

and I think it kind of puts its footing much more on the kind of B2C side and it's moving away from kind of heritage contracts where it's kind of B2B management and lottery systems. So I think that it gives it kind of a new platform, new systems, new solutions to build upon. However, I think kind of the integration is going to be key here for between Ballis Interactive and Intralot and I think that they've got a year, a strong year to kind of plan out

and we'll see what they build upon by the end of the year. So they're quite coy in terms of what the actual kind of deal elements are. I think that we're gonna see that further down the line.

Ted OC (03:23.738)
Yeah, it was an interesting announcement to read for yesterday. think partly from my perspective, one of the things that stood out to me was that Intralot seemed to be eyeing up a bigger footprint in the US following the completion of this transaction. I think it's expected to, they're expecting to complete it in sometime in Q4 this year. And.

Ted Menmuir (03:46.008)
Yeah.

Ted OC (03:47.781)
They seem to think that US state lotteries are going to be quite a big target for them. I think they seem to see a lot of value there. mean, given the US lottery sales and the revenue from that, numbers in the billions, I can kind of see why. think obviously getting these deals with state lotteries and government backed lotteries can often be tricky though, obviously, because the contracts are so long.

Would you would you agree me on that one? mean like the you know, these contracts are often 10 15 years So you might find yourself waiting waiting around a bit for an opening to come up do you think?

Ted Menmuir (04:25.518)
mean there's positive and negatives and one of things is that Interlot already does have a presence in the States in terms of its lottery contracts so even if it maintains those lottery contracts I think you can add on Ballet's interactive components on there. One of the things that they highlighted is that they've got new kind of inventory contracts coming up with Hasbro that will certainly add to their kind of game portfolio for lottery providers and I think you're right that yes lottery contracts are hard to shift.

However, you know, if you secure one or two, you're there to make a multi-million pound gains on that and really add it to your beta. It's an ambitious deal, but I think when it comes to these kind of high level.

But you know, billion mergers, man, you know, you have to have some vision. have to have some, you know, you have to be really active about where you think you're going to grow. And I think they are going to be push hard on those US lotteries. There's been a lot of ruptures in the market, as you know, as we reported on, especially with Texas and what that kind of fallout displayed to the public and to the state operators. You know, maybe one of maybe

Ted OC (05:29.572)
Hmm.

Ted Menmuir (05:37.136)
that kind of spearheads a change in the US and a couple of big state contracts get revised

Ted OC (05:44.507)
I think another interesting element there that I think you just touched on as well with the Hasbro deal and the provision of games to these lottery operators is that a lot of the lotteries all over the world, but especially in the US, I think we've seen a lot in recent years in response to the rapid expansion of the gaming industry, the betting industry, should say. Following the repeal of PASPA, a lot of state lotteries are wanting to stand out and compete with these new

Ted Menmuir (05:52.791)
Yeah.

Ted OC (06:14.294)
operators are coming into the state aren't they? And as a result of that I guess there could be some opportunities to provide these lotteries with the kind of iGaming and iCasino products that they might want to compete with a lot of other licensed operators. So that could be a potential inroad as well. So...

Ted Menmuir (06:31.85)
Yeah, I I hadn't thought of that. you know, especially kind of following like Jessica Woolman's work on SBC America is one thing that's kind of standing out is that the US is kind of a crossroad, not necessarily just for online wagering, but more for kind of online gaming and its platform, especially related to the casino product. And I think that maybe a lot of these lottery operators said, well, if they're getting rid of sweepstakes,

Ted OC (06:39.258)
Hmm.

Ted Menmuir (07:00.8)
maybe we can add kind of better gaming components to our retail service for lottery, know, scratch cards or incident win games. I think that's kind of a glaring opportunity in the US.

Ted OC (07:13.326)
And I think as well, you mentioned with Texas, I think a lot of state lottery operators in America right now might be looking out there and thinking, we want to make sure we've got a partner on board that we can trust who has got a good record.

Ted Menmuir (07:25.344)
Mm-hmm.

Ted OC (07:27.7)
And perhaps by acquiring this division of Bally's, which is obviously a legacy American brand, that could help intro a lot in that respect, I guess, with more familiarity with the American market, with the different stakeholders involved there, with the different lottery companies, with customers over above all, I guess, as well. That familiarity could definitely help, because like you said, we've seen, particularly in Texas, a lot of political pressure on the lottery system.

Ted Menmuir (07:34.22)
Yeah.

Ted OC (07:57.597)
a lot of questions raised about it, about the integrity of it, about the integrity of its third party partnerships. Obviously a lot of that's centred around the lottery couriers, but the spotlight has been cast wider and I think that adds another quite interesting dynamic to this whole conversation around lotteries and the commercial opportunities around them in America.

Just one more thing on this deal, Ted, before we get into our break. So, for some people this has kind of been a bit surprising, hasn't it? Because of Intralot and Balles are obviously two quite different companies in some respects. What do you make of this? What have you observed in this regard?

Ted Menmuir (08:46.146)
think you've to kind of break down the stakeholders in this deal. So there's Bally's Corp, Intralot and Intralot Interactive. I think in the case of Bally's Corp, this deal, they really needed this deal to, in particular, really kind of lessen those debt pressures that they have. And this is a company that's gone through, I think, two years now of losses.

terms of interlock, think when they needed something to really bolster their engine, they had, it's been quite a stagnant decade for interlock. So I think they had a tough time during COVID. They returned to kind of stable earnings two years ago. And I think that they'd be looking for a buy to get them back into kind of, or to kind of refresh their services. one of the that is mentioned is that, know, interlock really do have an international profile. They're active across 15 markets. They've got key contracts there. And I think that they really think that they can add.

Gamesys components, especially games exclusive contracts on content out to to their partners, you be in Croatia or Malta or where the service lotteries so I Think they got a lot of upside to benefit from that. I also think that intralot might be a better fit for the gamesys content Then then under the Bally's Corp. think Bally's has always been a very common very much so a Brits and Malta casino

I think that interlock does carry a more kind of digital or more kind of innovative kind of profile than Bally's Corp.

Ted OC (10:25.37)
Yeah, I think that's definitely an interesting perspective. you say, Ballets is historically like a Las Vegas, Nevada, bricks and mortar enterprise, isn't it? That's their legacy. That's their foundation kind of business, I guess. We're just gonna take a quick ad break and then we'll be back to talk about this topic a bit more.

Ted Menmuir (10:32.577)
Yeah.

Ted Menmuir (10:48.532)
pizza

Ted OC (10:55.45)
I meant to wait for that ad break thing to go. No, right, okay.

Ted OC (11:01.622)
And welcome back to I Go In Daily sponsored by OptiMove. I'm Ted Omklay, I'm here with Ted Memmiah and we're talking about of course, Intralot and the recent agreement of Ballet. Probably, mean, fair to say isn't it Ted, this has been the biggest &A we've seen in the industry so far this year. We've talked a lot about what this means for Intralot. mean, the...

Ted Menmuir (11:20.718)
Mm-hmm.

Ted OC (11:26.106)
And we touched a little bit on what it will mean for Bally's towards the end of this. I I think it's quite interesting that Bally's has been getting more and more involved beyond US borders over the past few years. You know, like you mentioned, GameSys, obviously they acquired that a couple of years ago. There was this deal here. And then not long ago, they also invested in the Star in Australia, didn't they? I mean, what do you think...

Ted Menmuir (11:41.452)
Yeah.

Ted Menmuir (11:50.317)
Mm-hmm.

Ted OC (11:53.241)
their motivations might be here for getting involved. If you look at these three countries I just mentioned, I've got the UK, Australia, and Greece. are three quite different and geographically spread out markets.

Ted Menmuir (12:06.486)
No, it's an interesting point of view and I think this is where you know we're go back to like the prospectus that's gonna come out and see what their kind of market by market strategy is and then again you know this is coming out of time where kind of hey all PLCs are kind of branching out I think one thing that does carry the favor of interlaw is that I think that they're kind of they're gonna face kind of less investor pressure being on the Aspyn's exchange rather than being kind of a

US face in PLC where they're going to be asked, well, you know, how can we not compete against DraftKings or Flutter? So I think like the, you know, that is, that is a lane where it's safer for them to be. And I think that they can take, they can be more strategic in what markets they select without kind of that internal pressure of like, you know, how you performing against the big, the bigger guys in the industry. Also, I think that it comes, the deal comes at a time where in the last two years,

especially at the lottery level, we've seen so many B2B technology providers kind of revise or downscale their technology services. So, you know, talking about scientific games and also this comes in light of IGT now turning, you know, becoming a standalone, returning back to being a standalone lottery business under the Bright Star banner. So again, many ruptures in the lottery, lottery sector. But I think that that...

the contracts and the playing fields are going to change remarkably in the next, by the close of the decade.

Ted OC (13:41.699)
Yeah, that is an interesting point of a lot of the changes on the B2B side of things could present a good opportunity for companies like these guys to get involved there. That's probably the timing of the deal with that probably makes a lot of sense. Now, just want to move things on a bit that you spoke to the newly appointed CEO of this new division, this new entity that's going to get formed via the agreement just after the transaction agreement was announced.

Ted Menmuir (13:49.451)
Yeah.

Ted OC (14:10.478)
Could you give our audience, this is available on SBC News, there's an article of course, we should plug that for you, go there and check it out. Yeah, yeah, go and read it, yeah, yeah. But you know, what was that conversation like? What did he have to say on the deal?

Ted Menmuir (14:16.078)
Please read it.

Ted Menmuir (14:26.412)
Well, obviously, mean, it's a game changer for both companies. And I think they've got high ambitions.

However, you know, asked them kind of questions of like look, know lottery contracts are hard to shift So I think they're kind of being quite pragmatic about this. I mean one thing that he you know Robson can open the line to us is that he is adamant, you know that this is a cash cash first Very highly effective to beat the generating company and that's how it should be valued, right? also the idea that you know, they're get contracts actually

One of the he noted is that if you can just improve what Interlot have on the table at the moment, that's going to be effective for the business down the line, right? So you're talking about Interlot and its management services. If you can just add to that, the deal is a winner.

Again, one of the that he mentioned was that at an hour gaming level, they're looking to enter two markets by the end of the year and that they're looking at expansions into sports books. I think what makes GameSys a very unique company is how good they are at integrating and actually getting products to launch. And this is from

the of their own content, but the fact that they've already proved this with the likes of Jackpot Joy and Virgin Games. So they do have a track record there. The problem is like, can you can repeat those partnerships in new territories? That's, I think, one of the one of the kind of barriers that they're going to get to, you know, can they get another Virgin? Can they get another Jackpot Joy?

Ted OC (16:19.386)
Yeah, that's a, thanks to Ed, that was a very thorough breakdown. There was a lot to digest in that one. I'm just, just think, yeah, we've got plenty of time left actually. So as I said in the introduction to this, you know, the M &A side of gaming is something that is constantly rolling on, right? It's...

Ted Menmuir (16:43.094)
Mm-hmm.

Ted OC (16:44.29)
I think there's not been a single year that I've been in this industry where there hasn't been some major mergers and acquisitions going on. I'm guessing then, in your opinion, is this deal announced this week indicative that the gaming industry &A is just going to be carrying on as fast-paced as ever in 2025?

Ted Menmuir (17:06.154)
Yeah and even towards the kind of yeah it's gonna be year and year towards the end of the decade look you know let me start again yeah ask that question again

Ted OC (17:20.922)
Yeah, sure. So like I said in the introduction, know, gaming industry M &A, M &A I should say is one of the more defining aspects of the gaming industry. I don't think there's been a single year that I've been in this industry where there hasn't been some huge M &A stories going on. This is obviously the biggest one of this year so far. We're just over halfway through the year. Is this indicative of, you know, of gaming industry M &A showing no signs of slowing down in 2025?

Ted Menmuir (17:51.119)
I feel conditions always constant and I think there are so many factors to what contributes to it. Be it regulation, markets saturating and just also now cost controls and companies looking out for these for just to gain an edge.

I think that if you review the &A's in the past five years and what we created with these kind of giant gaming PLCs now, I think there's going be kind of a lot of internal revisions. Look, I think there's going to be &A's across the board, whether they're small size, mid size or at the PLC level. I think there's just too many kind of tectonic shifts going on in the industry. I think that's just part of it.

It's gonna be like this for the next couple of years and will it keep us in the job? yes, I'm not complaining.

Ted OC (18:47.802)
Yeah, Yeah, no complaints there. It gives us something to do. It gives us podcasts to record things about, doesn't it? Yeah, mean, obviously there's an interesting one. Our colleague Victor wrote about this the other day. There's rumors circulating that an Irish businessman is interested in acquiring the Irish assets of Ladbrokes, and Tain's Ladbrokes.

Ted Menmuir (18:55.116)
Yeah.

Ted OC (19:12.602)
at some point, that's an interesting one to follow. Obviously there's also been the rumours about a potential sale of Bet 365. A lot of people I speak to from across the industry all were quite interested in that. I obviously I know they're just rumours to begin with, that would be huge, wouldn't it? I would be probably like the biggest sale in this industry at the moment.

Ted Menmuir (19:15.16)
Yeah.

Ted Menmuir (19:34.124)
Yeah, but even you got to read what the dreamers tell you. I mean, again, OK, that view of of that Brooks, right, and why it's under speculation, it's clearly obvious because, you know, and Tainer assess and kind of every dynamic to return back to profitability for their investors. Right. I just think that.

Ted OC (19:52.452)
Yeah.

Ted Menmuir (19:59.016)
When we get to the point where we're talking about the big PLCs within multi-brand portfolios, everything's under assessment. And in terms of even if you are, if you start to kind of stagnate within a market or within a certain segment of gaming, that brand can be up for sale. And again, just shifted out to the market.

Ted OC (20:27.93)
All right, think that is, I think we're all out of time now. I think that's a good point to leave it on. I think we've kind of gone full circle there, haven't we, from started talking about the significance of M &A and we've ended up talking about the significance of M &A. So yeah, good roundup there. Ted, thanks so much for taking the time to speak to me about this one. Quite an interesting story and one that we'll keep following as it unfolds along with any other major industry mergers and acquisitions, of course. So yeah, thanks so much, Ted. Thanks to all our listeners for.

Join in and we'll see you next time.