In an effort to bolster its iGaming content portfolio, Scientific Games (NASDAQ:SGMS) is acquiring European games developer ELK Studios.
Financial terms of the transaction weren’t disclosed. The deal is part of Scientific Games’ ongoing effort to become a player in the fast-growing world of digital gaming.
The acquisition is the latest in a string of important, targeted content-focused deals as the Company moves quickly to invest in and grow its presence in digital markets. By adding ELK Studios to its in-house games portfolio, the Company has further bolstered its capacity for creating innovative, engaging iGaming content,” according to a statement.
Scientific Games said it plans to bring ELK’s content to the US and Canadian markets. That’s while boosting the Swedish company’s already strong perches in Europe and the UK. ELK’s popular titles include Wild Toro II, Katmandu and Cygnus.
Rapid Transformation for Scientific Games
Entering this year, Las Vegas-based Scientific Games was primarily viewed by investors as a slot machine manufacturer. It is the owner of the OpenBet sports betting platform and one of the dominant names in lottery services. That portfolio includes providing the systems used to generate Mega Millions and Powerball tickets.
Today, OpenBet and SG Lottery are departing the company’s portfolio, as it looks to reduce debt and hone its focus on digital gaming. In September, the sports wagering platform was sold to Endeavor Group Holdings, Inc. (NYSE:EDR), the parent company of the Ultimate Fighting Championship (UFC), for $1.2 billion cash and stock. A month later, SG Lottery was sold to Brookfield Business Partners LP (NYSE:BBU) for $6.05 billion.
Investors are warm on the plan to reduce debt and focus on the fast-growing iGaming market. The company is making a series of bolt-on buys to that effect, including the acquisitions of slot developer Lightning Box and premium live casino solutions provider Authentic Gaming.
ELK Studios, which is profitable, will work independently to generate new content. The statement doesn’t indicate when the transaction will close.
Other Moves by Scientific Games
Scientific Games is making other moves to enhance its digital footprint.
For example, the company is attempting to acquire the 19 percent of social casino developer SciPlay Corp. (NASDAQ:SCPL) it doesn’t already own. That offer was made in mid-July, and no formal decision has been made by the target.
In August, Scientific Games said it’s acquiring Sideplay Entertainment in an effort to add to its roster of internet lottery offerings. Sideplay brings a contract as the primary supplier of eInstant games with the UK National Lottery, one of the biggest lottery groups in the world, to the table.
Even with a November decline of more than 20 percent, shares of Scientific Games are up 54 percent year-to-date.
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