Date: 22.12.2023

by Antoni Majewski

Gaming Innovation Group Inc. Acquires KaFe Rocks

Gaming Innovation Group Inc. (GiG), a key player in the iGaming industry, has officially announced the completion of its strategic acquisition of KaFe Rocks Ltd., an affiliate leader in the iGaming sector. This move, following the announcement on November 7, 2023, significantly strengthens GiG’s media division, GiG Media, and solidifies its dominance in online casino affiliation, particularly in the lucrative North American market.

Building on the momentum of the successful AskGamblers acquisition, GiG Media is set to drive substantial growth for the acquired KaFe Rocks assets. By leveraging its proprietary media and marketing technology, GiG Media anticipates significant revenue generation from these assets. The synergy between GiG and KaFe Rocks is projected to yield a minimum revenue of MEUR 23 in 2024, with an EBITDA margin exceeding 45%. This translates into a 2024 EV/EBITDA multiple of approximately 3.6x for the acquisition.

A Strategic Step for GiG’s Expansion Goals

Jonas Warrer, Group CEO of GiG, expressed his satisfaction with the acquisition: “Our goal is to maintain our position as the leading casino affiliate in the industry and to expand further in the North American market. The inclusion of KaFe Rocks aligns perfectly with these objectives… We eagerly anticipate integrating KaFe Rocks into the GiG family, unlocking additional business value to benefit our partners and investors.”

The acquisition is a strategic move to diversify GiG Media’s business, aligning with the company’s goal of mitigating overall risk. The addition of more customers, websites, and markets through this transaction is expected to drive forward revenue growth for GiG Media.

Financial Details of the Acquisition

The transaction, valued at MEUR 35, involves an upfront cash payment of MEUR 15 and MEUR 20 distributed over 24 months in four semi-annual payments. Moreover, GiG may issue MEUR 2.5 in its shares to the sellers in Q1 2024, contingent on certain operational cost savings targets being met by the end of 2023. The number of shares to be issued will be based on a 30-day VWAP of the GiG share at the time of closing. KaFe Rocks’ assets will be consolidated into GiG’s portfolio starting today.