IGT sells Double Down Interactive for $825M

PROVIDENCE – International Game Technology PLC on Tuesday said it is selling its social casino subsidiary, Double Down Interactive LLC, to an affiliate of Seoul, South Korea-based DoubleU Games Co. Ltd. for $825 million.

The sale is expected to close in the second quarter, and the transaction will be reflected in an updated financial outlook as part of IGT’s first-quarter earnings release late next month.

According to a news release from IGT, the transaction establishes a new multi-year strategic partnership between IGT and DoubleU Games to provide new player experiences in the worldwide social casino market.

“Since acquiring DoubleDown in 2012, IGT has grown it into one of the largest and most successful brands in the North American social casino market,” Marco Sala, CEO of IGT, said in a statement. “After several years of strong, organic growth and increasingly attractive valuation levels, the time is right for us to maximize the value of this asset for our shareholders. We will continue participating in the growth of the social casino market through our multiyear, strategic partnership with DoubleU Games.”

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Said GaRam Kim, CEO of DoubleU Games, “With this partnership, we are excited and confident about DoubleU Games’ future as a global leader in social casino.”

The cash purchase price represents 10.5 times DoubleDown’s full-year 2016 adjusted earnings before interest, tax, depreciation and amortization. IGT said proceeds from the transaction will be used for debt reduction and other general corporate purposes.

Once the sale closes, the parties will enter into a game development, distribution and services agreement enabling DoubleU Games to offer IGT’s casino game library on DoubleU Games’ combined social casino platforms, in exchange for ongoing royalties to IGT.

IGT’s Board of Directors and the governing body of DoubleU games have approved the sale.

Lori Stabile is the PBN Web Editor.