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The company will use the funding to “substantially increase [its] software engineering and operational resources to better serve existing major US clients…” The capital will also help erase a £2 million convertible note from last year, making GAN debt free.
Shareholders considered the proposal during their general meeting in May and gave approval last month.
The sudden movement toward legal US sports betting is tempting the industry leaders abroad. Add GAN to the list of large European gambling companies establishing positions in the American market.
Here’s CEO Dermot Smurfit on the funding:
This strategic capital raising exercise, completed today, positions GAN to consolidate its US market position and capture substantial incremental revenue opportunities available resulting from both Internet gaming and sports betting regulation in New Jersey, Pennsylvania and other US States expected to regulate Internet gambling in the near future.
Online gambling legislation is a little sluggish these days, but sports betting bills have dotted the map all year long. Three states have legal wagering right now, and at least four more will join before the end of 2018.
Primarily a casino supplier, GAN began to maneuver toward sports betting in advance of the US Supreme Court ruling.
Early this year, the company teamed up with SBTech, a fellow B2B giant with an established bookmaking platform. The agreement gives GAN the capacity to provide sports betting services to its existing casino clients.
During the announcement, Smurfit indicated several clients had already asked GAN to “review, procure and support the delivery of a sports betting solution.”
GAN has done pretty well to stay at the leading edge of US gambling expansion over the last several years.
Way back in November 2014, the group struck a long-term deal with Parx Casino in Pennsylvania, starting with a social online casino. GAN’s portfolio of social partners also includes Winstar (Oklahoma), Borgata (New Jersey), Red Rock (Nevada), and Empire City (New York).
The Parx deal was ahead of its time, predating PA gambling expansion by three years. Now legal, if an old deal still holds up, GAN will launch “all forms of real-money internet gaming” for Parx in the coming months, including online poker and PA sports betting.
The group has held an NJ gaming license since April 2017, and it’s just secured its first standalone partnership. The Ocean Resort Casino has chosen GAN to power its forthcoming NJ online casino, expecting to launch shortly.
GAN also has a long-standing relationship with Paddy Power Betfair, another large European gambling outfit. The duo teamed up to create the Betfair NJ online casino, and GAN could potentially tag along into additional markets.