The best purchases in life are those that don’t come with debt. That’s exactly what Australian-based Ainsworth Game Technology is getting when it closes on the acquisition of US-based Nova Technologies LLC early next year. The USD $38 million price tag will be paid in cash as Ainsworth aims to double down on its American commodities.
The company announced on Tuesday that it’s reached a binding agreement with Nova Technologies in which it will obtain 100% equity in the small-scale pokies maker, which currently supplies about 1,300 Class II (bingo style games) and Class III (traditional pokies) to casinos across 11 US states.
Ainsworth is already responsible for approximately 1,300 poker machines (known throughout America as slot machines) at US-based casinos. Thus the acquisition will effectively double the company’s existing presence in the US market. It also gives Ainsworth its first taste of Class II gaming, which dominates the Tribal-owned casino industry throughout the United States.
In filing its intentions with the Australian Securities Exchange, Ainsworth announced its hope to close on the deal sometime in early 2016, “subject to all necessary regulatory approvals”, of course.
Danny Gladstone, Chief Executive Officer at Sydney-based Ainsworth Game Technology LLC, extolled the company’s latest US-facing vision. “The transaction allows us to enter Class II gaming in an immediate and significant manner. This deal represents a complementary extension of available product to the direct benefit of Ainsworth’s current customer base across the Americas,” he said.
With the ability to purchase the American slots developer free and clear of debt, Gladstone explained, “This acquisition is earnings accretive from day one. For these reasons, it makes both great strategic and financial sense for Ainsworth.”
Nova Tech brings Innovation to the Table
With headquarters in South Carolina and additional offices in Oklahoma, the slots developer has been in operation since 2004, rebranding itself Nova Technologies LLC in 2012. Its current portfolio contains 30 proven Class II poker machines, widely distributed throughout all major Native American markets.
One of the company’s most innovative features is a dual 24” monitor cabinet with built-in USB charging station for mobile devices, introduced at the OIGA 2015 conference in July. Such forward-thinking is what attracted Ainsworth Game Technology, owned by legendary pokies maker Len Ainsworth, to the company in the first place.
Mr. Ainsworth commented on the venture himself, stating, “We have been disciplined and highly selective in our acquisitive growth strategy and we are now excited to have an excellent platform that we can substantially grow and develop over time.”
The Australian poker machine manufacturer saw immense year-over-year growth, reporting in August that the last 12 months, ending June 30, 2015, were exceptionally successful for the company. Ainsworth experienced a revenue boost of 14%, generating AUD $70 million in profit.
Ainsworth Announces Changes to the Board
Coinciding with the announcement of Ainsworth’s latest acquisition was another statement involving changes to the company board. It was revealed that in mid-January, pending regulatory approval, Ainsworth’s round table will be joined by a new independent, non-director, Heather Scheibenstock.
Ms. Scheibenstock is coming over from her previous role at Philippines-based Solaire Resort and Casino, where she held the position of Senior VP of table games. Prior to that, she was the general manager of Australian-based Echo Entertainment’s Sydney casino property, The Star.