Month: June 2022

NeoGames in January launched a public offer worth SEK4.3bn (£344.1m/€402.3m/$423.5m) to acquire 100% of the shares in the B2B igaming technology solutions provider.

The initial acceptance period for the offer was due to expire on 25 May but was extended to 14 June to give all shareholders the chance to accept NeoGames’ offer.

In total, 99.31% of the shares in Aspire Global were tendered.

Shares of Aspire Global that remain outstanding after 30 June will be subject to a squeeze-out proceeding that is due to complete on or around 11 August. Under this procedure, NeoGames may compulsorily purchase the remaining shares of Aspire.

The offer was funded through a combination of newly issued NeoGames shares and cash, with NeoGames to issue approximately 7.6 million shares to Aspire Global shareholders as payment of the equity component of the offer, and also pay $264.0m for the cash section of the deal.

The combined business will be led by Moti Malul, the current chief executive of NeoGames who will remain in this role for the enlarged group, and Raviv Adler as chief financial officer. Tsachi Maimon, chief executive of Aspire Global, will serve as president and lead the newly formed igaming division.

The current board of directors of NeoGames will remain in place with no changes

“We are thrilled to complete this strategic transaction with the Aspire Global team, and to commence working on identifying potential opportunities to capitalise on the merger of our platforms,” Malul said. 

“We believe this strategic combination will generate long-term shareholder value by synergistically capitalizing on the key strengths of our two companies and will help position NeoGames for expansion in new and existing markets. 

“By integrating our market-leading platform and scalable position within the rapidly expanding global ilottery market, with Aspire Global’s proprietary sports betting platform, BtoBet; its igaming content and aggregation platform, Pariplay; and its proprietary content and turn-key B2B igaming solutions, NeoGames is well positioned to increase our addressable market opportunities, and further expand our services to our North American customers.”

Maimon added that the two businesses fit well together culturally.

“We believe both companies are well positioned to mutually grow our two platforms and execute on our strategic initiatives. Not only is this a strategic fit, it is also a strong cultural fit, as significant parts of both management teams worked together extensively during NeoGames’ inception,” he said.

Total market revenue was up from $413.2m in May of 2021, but down 3.2% from a record $462.7m in April this year.

Land-based gaming remained the most popular form of gambling among consumers in the state, with retail slots revenue increasing 2.1% year-on-year to $205.7m and retail table games revenue 14.7% to $88.6m.

Sports betting revenue was up 26.2% to $35.0m, though retail revenue here was just $2.8m, with $32.3m being attributed to online wagering. The state’s handle also increased by 10.3% to $493.4m.

Valley Forge, along with partner FanDuel, retained top spot in the sports wagering market with $19.8m in revenue from $193.4m in bets. 

Hollywood Casino at the Meadows’ Barstool Sportsbook placed second with $7.1m in revenue off a $111.5m handle, then Hollywood Casino at Penn National and DraftKings with $1.9m from $34.4m in wagers.

Turning to online casino activity and revenue from internet slot games was 16.3% higher at $78.2m, while online table games revenue also edged up 2.8% to $32.3m and online poker revenue climbed 8,0% to $2.8m.

Hollywood Casino at Penn National led the way in igaming with $45.5m in revenue, ahead of Rivers Casino Philadelphia on $26.9m, then Valley Forge Casino Resort with $21.2m.

Elsewhere, video gaming terminal revenue was 1.8% higher at $3.7m, though fantasy sports revenue declined 20.71 to $1.6m, meaning it was the only area of the Pennsylvania market not to experience growth in May.

Revenue for the month amounted to $430.6m (£349.8m/€409.2m), up from $374.2m in May 2021 and also 1.9% higher than $422.5m in April of this year.

Land-based casinos remained by far the primary source of revenue in New Jersey, with revenue from these properties reaching $233.0m in May, up 9.3% year-on-year. Slots revenue was 10.5% higher at $174.3m, while table games revenue also climbed 6.1% to $58.7m.

Online gambling revenue jumped 25.7% year-on-year to $136.0m, due to a 26.4% jump in internet slots revenue to $133.7m. However, online peer-to-peer poker revenue fell 4.0% to $2.3m, making it the only area of the market to experience a decline in May.

Borgata remained the runaway leader in the igaming sector, posting $42.6m in revenue for the month. Resorts Digital followed in second with $29.8m, marginally ahead of Golden Nugget on $29.7m.

The New Jersey Division of Gaming Enforcement (NJDGE) also noted $4.9m in revenue from Golden Nugget Online Gaming (GNOG) but said that as GNOG surrendered its licence for igaming and online sports betting on 4 May, as of 5 May, all such revenue was reported under Golden Nugget.

Turning to sports betting and revenue was 16.4% higher at $61.6m, despite a 5.9% decline in the state’s handle to $766.4m. Some $708.4m was wagered online, while $58.0m was bet at retail locations.

Meadowlands, partnered with FanDuel, continued to lead the market with $35.5m in sports betting revenue, followed by Resorts Digital, which has sportsbook deals in place with both DraftKings and Flutter’s Fox Bet, on $11.3m. Borgata ranked third with $6.4m in revenue.

Looking at year-to-date performance, total gambling revenue in New Jersey for the five months to the end of May was $2.03bn, up 18.1% year-on-year.

Land-based casino revenue was 20.7% higher at $1.08bn and igaming revenue hiked 29.3% to $681.4m, though sports betting revenue was down 9.3% to $269.4m. 

The Belgian government proposed the completed banning of gambling advertising on 10 May, with the exception of the lottery. The new rules are set to go into effect from the end of the year.

Weerwind’s remarks came in the context of Belgian Justice Minister Vincent van Quickenbourne’s assertion that “gambling is the new smoking and everyone agrees it is better without tobacco advertising,” as he announced the ban.

In a reply to parliamentary questioning from Evert Jan Slootweg, Weerwind pushed back against comparison of gambling to a public health problem rather than a risky recreational activity.

“I do not fully identify with the statement of Minister van Quickenborne. We know that every cigarette is bad for your health. Games of chance are a form of leisure for many people and do not cause any problems for a very large proportion of people.”

While the minister acknowledged the dangers that gambling can entail, he stressed that the answer should be better regulated and safer legal gambling rather than a blanket ban: “Gambling does involve risks. Because of these risks, it is important that players are well protected. This happens with legal providers, who have to adhere to strict rules.”

Weerwind did not say that advertising reforms were completely unnecessary; pointing to some actions already undertaken by his government: “The use of role models for risky games of chance will no longer be permitted from 30 June 2022. Work is also currently underway on a ban on untargeted advertising for risky games of chance, as announced in the letters to the House of 17 March and 21 April 2022.”

The minister also argued against the notion that the increase of played hours per month since the legalisation of online gambling should be a worrying development in itself.

“I place the observation that the number of hours’ people spent on websites of legal providers has increased in the context of the gambling policy. It has not been the aim to increase participation in games of chance. It has also not been a goal to keep this at the same level.”

He continued, “The aim of the games of chance policy is to ensure that when people play, they do so as safely as possible. In doing so, we must be mindful of the risks of addiction and prevent vulnerable people, such as young people, from being led to games of chance. The protection of vulnerable people is better guaranteed with legal providers than with illegal providers.”

In recent months, KSA said it had received a number of reports from players who had self-excluded through Cruks but were still able to access slot halls.

Some players reported being able to access the venues without any restrictions, while others said their registration with Cruks was ignored.

Licensed operators in the Netherlands are required to check if a player is signed up to Cruks before allowing them to gamble. The KSA said that if it identifies any violations of such rules, it could impose sanctions.

“Failure to check players or ignore a Cruks registration is very serious,” KSA said. “These players registered with Cruks precisely because they have problems with gambling and are no longer in control.”

Launched in October last year, Cruks allows player to self-exclude from gambling, while they can also be referred to the scheme by friends and family concerned about their behaviour or an operator that has flagged potential gambling related harm.

KSA in December urged licensed operators to carry out checks of their customer bases to ensure no players are signed up to Cruks after identifying an error with the scheme.

The regulator said the error, which was rectified, may have been down to inaccuracies when signing up to Cruks, such as a consumer inputting their citizen service number (BSN), name or date of birth incorrectly.

The error may have impacted players who registered for new igaming accounts between 2 and 20 October.

The operator said it had taken the “difficult decision” to withdraw its application for sportsbook and virtual slots licences, and cease all operations from 1 July.

“Our long-term strategic direction sets out locally regulated markets as the core engine for our growth, however licence application procedures, licence conditions, and the regulatory environment need to be transparent, sustainable, and financially viable for a market to be competitive,” Kindred explained.

It said the current application processes, and the terms and restrictions for product offerings, meant the regulated market was not sustainable nor competitive enough to withstand offshore competition.

“Therefore, we do not see a foundation for long-term shareholder value and customer experience at the moment.”

As its current operations in Germany are limited, the withdrawal would have an “insignificant” financial impact on the business.

Germany’s Fourth State Treaty on Gambling included a number of strict terms for operators. These include a €1 stake limit for online slots, and a €1,000 loss limit that applies across all operators, with only limited exceptions. A 5.3% tax on turnover, which was extended from online sports betting to online slots, has been widely criticised as unworkable by operators and associations.

Kindred had initially intended to participate in the market, filing an application for a sports betting licence in February 2020, then for its virtual slots permit in 2021, after the new State Treaty came into force from 1 July. A Kindred spokesperson told iGB that the triggering factor for the withdrawal – after previous indications that the operator planned to stay in the market – was that the operator was specifically informed that authorities had made no decision on the applications.

“We were expecting to receive a positive decision on the licence application,” the spokesperson told iGB. “Instead, we were informed that no decision was reached, meaning our application would be pending for an unknown period of time. Which is not sustainable.”

The operator has not ruled out a return, however, noting that its position “may change in the future”.

New players are already unable to register with Unibet’s German site, while deposits are also blocked. However, the site will remain open until 30 June, with players able to bet with their existing balances and withdraw funds until this date.

As a result of its withdrawal, Kindred added, it would focus instead on other strategic projects.

“We are dedicating full attention to growing our North American market, achieving greater product control with the Kindred sportsbook platform and the acquisition of Relax Gaming, expanding our single platform vision, and achieving our ‘Journey towards zero’.” 

The business is also poised to return to the Netherlands igaming market in the near future. It withdraw from the Dutch market in October 2021 as local gambling laws required all businesses without licences to block Dutch customers – something it failed to do before that point. However, it received a licence earlier this month that will allow it to relaunch.

Kindred’s share price has largely been resilient in the face of the news. Its share price declined from SEK99.00 on 10 June to SEK93.08 at the time of writing (17 June), a decline of 6.0%.

Issued by the Michigan Gaming Control Board, the Provisional Internet Gaming Supplier Licence will enable Stakelogic to provide its online slots to licensed operators in the US state.

Stakelogic said that its launch in Michigan forms part of wider effort to expand its business across the North American market, with further launches in other states planned over the coming months.

“Securing approval to launch in Michigan is a milestone moment for Stakelogic and our ambitions for the US market where we intend to become a leading provider of popular online casino content,” Stakelogic chief executive Stephan van den Oetelaar said.

Van den Oetelaar added that Stakelogic games had already proven popular in the US, and he was excited to see this continue in Michigan.

“Securing approval to launch in Michigan is a milestone moment for Stakelogic and our ambitions for the US market where we intend to become a leading provider of popular online casino content.

“Our classic slots and video slots have taken global markets by storm, and we expect them to be a big hit with players in Michigan and across the US. We are already in talks with operators in Michigan and look forward to integrating our slots in due course.”

The Michigan licence comes after Stakelogic in March also secured a licence from the Malta Gaming Authority, while in July last year, the developer was awarded a licence in Ukraine.

FATF – a global anti-money laundering body – keeps a list of “jurisidctions under increased monitoring”, also known as its grey list.

In a press conference today – which was delayed due to extended discussions at the FATF plenary – the body revealed that Gibraltar was added to the list.

As a result, officials in Gibraltar have adopted an action plan on the issue.

“Gibraltar needs to take a number of steps including focusing on gatekeepers to the financial system, including gambling operators and lawyers,” FATF chair Marcus Pleyer explained. “At the moment, supervisors are not applying sufficient fines for anti-money laundering failings.

“This is important as the gambling sector in Gibraltar is large and is aimed at foreign jurisdictions.”

The organisation added Malta to its list of jurisdictions subject to increased monitoring in June 2021, alongside the Philippines, Haiti and South Sudan.

FATF explains that it places countries on the list if it believes they have “strategic deficiencies in their regimes to counter money laundering, terrorist financing, and proliferation financing”.

When it added Malta to the list, FATF presented Malta with an “action plan”, focused on three prongs. The first of these points related to demonstrating that beneficial ownership information is accurate, while the second and third related to increasing and better defining the role of its the Financial Intelligence Unit.

In a March update, the organisation then revealed that Malta had “substantially completed its action plan” by making reforms. This included increased use of the Financial Intelligence Unit’s (FIU) services to pursue money laundering and criminal tax cases.

However, the organisation decided that the country required an on-site review to ensure the AML measures are being implemented.

With this review now complete, Malta has been removed from the list.

“That doesn’t mean there isn’t more work to do,” Preyer added. “Going forward, the FATF strongly encourages Malta to continue improving its system.”

The Philippines, meanwhile, remains on the list. When it was initially added, its seven-point action plan included one point specifically related to casino junkets.

According to data from regulator the Dirección General de Ordenación del Juego (DGOJ), gross gaming revenue was down by 14.8% to €204.4m. However this marked a 16.3% quarter-on-quarter increase.

Revenue fell despite an increase in stakes, which grew 5.3% year-on-year to €7.41bn, a new record high. Deposits, meanwhile, grew by 4.3% year-on-year – or 7.1% quarter-on quarter – to €769.8m.
A similar trend emerged in 2021, when revenue was down despite a significant increase in stakes.

Breaking down revenue by vertical, sports betting revenue continued to be low at €65.2m, a 40.9% fall from Q1 2021, but up 49.1% from Q4 of that year.

Sports betting stakes remained high at €3.06bn, up 10.6% year-on-year, as it had done in H2 2021. This suggests a sports betting margin of just 2.1%. Margins were low across all sports, but lowest in horse racing at 1.4%.

House-banked casino gaming, on the other hand, performed well, with revenue of €111.0m, an 11.5% year-on-year increase. Of this total, €64.9m came from slots, up 1.2%, and €34.3m from roulette, down 5.2%. Stakes for the vertical were up 4.7% to €3.72bn.

Poker brought in an additional €20.5m, down 2.0% from 2021, while bingo revenue came to €3.6m.

Data from DGOJ also showed the impact of the country’s wide-ranging marketing restrictions. Marketing expenditure fell 27.7% compared to last year at €107.9m.
Facing fewer restrictions, affiliate marketing benefitted, with spend jumping 84.0% to €22.7m. Sponsorship spend dropped from €9.4m to just €632,784, after it was effectively banned, while traditional ad spend was slashed to €34.4m. 

Free bets became the largest form of marketing, though operator investment was down 10.5% at €50.7m.

The bill will be the culmination of work stretching back to last year, when the government started a consultation to examine major changes to market as a major milestone in deciding what the shape of future gambling reform should look like.

The bill raises the number of concessionaries in Macau to six, but removes subconcessions, meaning that the number of operators in the market would be the same. Changes for operators include limits on the number of gaming machines and tables they can host – based on minimum GGR limits – and rules allowing junkets to deal with only one concessionaire each.

It will also reform taxes in the city; allowing the Chief Executive more discretion in granting tax breaks, but also includes a general tax rise.

The news comes after the Second Standing Committee of the Legislative Assembly published the final version of the bill yesterday.

While many aspects of Macau gaming tax law are set to stay the same: for example, there will be no change in the number of concessionaires, which will remain at six – the language will allow the special administrative more leeway in designating tax breaks for operators, particularly in the case of attracting foreign customers.

“The Chief Executive may, after consulting the Bureau of Gaming Supervision [DICJ], grant a reduction or exemption to the concessionaires in the payment of the contributions[…], for reasons of public interest, namely for reasons for expanding customer markets in foreign countries.”

But the bill also includes a tax rise on GGR. At the moment operators, in addition to a 35% gaming tax, must also pay “up to” 2% of GGR for “promotion, development or study of cultural, social, economic, educational, scientific, academic and philanthropic causes”.

Concessionaires must also pay up to 3% of GGR towards “urban development, tourism promotion and social security”.

In practice none of the current businesses pay the full amount. The new language removes the phrase “up do” from the laws, meaning that all will now be subject to the highest degree of tax.

The consequences of these reforms are unclear, though the higher basic tax rate in combination with the new Chief Executive powers may allow the government more scope when dealing with the concessionaires.