Light & Wonder announced today (18 February) it has agreed to purchase the charitable assets of Grover Gaming for $1.05bn.
The all-cash deal will see the US land-based and iGaming giant enter the charitable gaming space, which it argued will complement its cross-platform strategy.
It is the first major M&A activity by the business since it acquired the remaining 17% stake in social gaming developer SciPlay in August 2023.
Light & Wonder CEO Matt Wilson said: “Grover Gaming is a leading player in charitable gaming, a category that has experienced significant growth in recent years.
“This transaction complements our position as the leading cross-platform global games company by adding another compelling regulated adjacency to our profile.”
“Importantly, there are exciting incremental revenue opportunities to be realised by leveraging Light & Wonder’s proven land-based gaming content to a new and loyal customer base.
“We look forward to continuing to partner with Grover Gaming’s customers, building on its strong dedication to customer service.”
Blackwelder to collaborate with Light & Wonder
Founded in 2023, Grover Gaming, which is currently owned by its CEO and founder Garett Blackwelder, has an installed base of over 10,000 leased electronic pull-tab units across five US states.
Under the terms of the agreement, Blackwelder will collaborate with Light & Wonder to help drive the business’ success over the next three years.
The initial $850m consideration will be subject to customary purchase price adjustments, and complemented by a four-year revenue based earn-out of up to $200m.
The upfront consideration implies an approximately 7.7x multiple based on Grover Gaming’ 2024 adjusted EBITDA.
The company’s “attractive” financial profile, which is expected to be highly accretive to value and earnings, was highlight by Light & Wonder when announcing the deal.
Following the completion of the deal, Light & Wonder said it will operate the business with a combination of its own employees and those of Grover Gaming.
Blackwelder said: “I am very thankful for all of our Grover Gaming teammates and how hard they work every day. I’m also grateful for our customers’ loyalty over the past two decades.
“We realise without them, we wouldn’t be where we are today. Light & Wonder is an ideal partner for us, given our similar company cultures and dedication to innovation and customer service. We are excited to see charitable gaming taken to a new level!”
Light & Wonder said it expects to fund the acquisition with existing cash and incremental debt financing.
The company added that post-completion, it expects its net debt leverage ratio on a combined basis to remain within its 2.5x-3.5x target range.
It also reaffirmed its 2025 $1.4bn consolidated adjusted EBITDA target, which it said was underpinned by continued strong organic growth across the business.
