(PRESS RELEASE) -- Cherry announces that it has acquired 71 percent of the shares of the Malta-based company Almor Holding Limited (Almor), a leading online casino business specialising in German-speaking markets. The effective date of the acquisition is July 1, 2015, and Cherry AB will consolidate Almor within its group accounts from July 1 but have the right to the earnings from May and June in the acquired balances. Cherry expects Almor to report positive EBITDA in both May and June as well as the remaining part of 2015, contributing to Cherry’s Online Gaming division, which expects to report a positive EBITDA in Q3 2015.
Almor’s principal brands Sunmaker
, Sunny Player Casino
and Kingplayer have established a strong position in their core markets since the business launched in 2011, offering a large range of online casino games and a sportsbook. These brands had over 55,000 active customers in the first 5 months of 2015 and a registered customer database of approximately 355,000. We believe that the business is the largest operator of Merkur Slots, developed by Edict eGaming, which are among the most popular slots titles in Almor’s core markets.
Fredrik Burvall, President and CEO of Cherry, commented: "Cherry has developed a strategic position in Germany, where we already hold all currently available online casino licenses, including in Schleswig Holstein. With this acquisition, Cherry immediately becomes a major online casino player in this major European market. In the short-term this enables Cherry to grow significantly and to strengthen the Online Gaming business division. The deal gives Cherry a larger and more significant presence in continental Europe, contributing positively to both our margins and our growth prospects."
Almor was founded and continues to be managed by online gaming industry veterans with a successful track record. The management team have over 15 years’ experience in the sector, having held senior roles at Sportingbet
, Full Tilt
. This management team will retain a significant shareholding in Almor and will continue to run the business with a focus on international expansion of its core brands, as well as supporting the running of Cherry’s existing German business.
Alexander Knopf, director of Almor, added: “We are delighted to be joining Cherry, whom we believe to be the ideal partner for Almor to continue its remarkable growth. Cherry’s international reach, multiple licenses, flexible technology platform and in-house game development will be highly complementary to our local market knowledge, established brands and customer base.”
The acquisition is expected to enable Cherry to increase both revenue and profit, as well as giving the company a stronger position in the German speaking market. Almor’s net gaming revenue for 2014 was €11.1 million, with a profit of €1.2 million. Since January 1, 2015, Almor has incurred VAT charges at 19 percent. However, this has been offset by a strong trading performance, generating net gaming revenue of €5.9 million and an EBITDA of €0.8 million in the first five months of 2015.
The purchase price for 71 percent of the shares in Almor Holding Limited is €4.6 million (MSEK 42.7). Cherry has the right to buy the remaining part of Almor within the next four years and eight months. Payment of the initial purchase price will be made 50 percent in cash and 50 percent in Cherry shares. Further purchase consideration can be made in Cherry shares or in cash at Cherry’s discretion. The shares will be valued based on the average closing price in the three (3) trading days prior to and three (3) trading days including and following this announcement, in relation to the payment for the Initial Shares.
Almor was advised on the transaction by Akur Capital.