Acquisition of a UK Sports Betting Website

RNS Number : 1250P

XLMedia PLC

14 August 2014

 

For immediate release

14 August 2014

XLMedia plc

("XLMedia" or "the Group")

Acquisition of a UK Sports Betting Website

XLMedia (AIM: XLM), a provider of digital performance marketing services, is pleased to announce that it has agreed to acquire a leading UK Sports betting website for a cash consideration of US$6.72 million (GBP 4 million).

The acquired website is focused on UK web and mobile traffic, specialising in sports betting. In addition, as part of the transaction, the Group will also purchase a second website providing content for casino. Active since 2006, the websites have been building a steadily growing traffic and social followers, providing their visitors with useful information, such as betting tips and reviews of online casino websites in the UK. The websites refer significant number of players to their customers' websites. For the 12 months ended June 2014 the websites recorded an EBITDA of GBP 920,000 (unaudited).

The acquisition is another revenue enhancing addition to the Group's website portfolio and complements it in the following fields:

·     First significant assets targeted at the UK market, a well-established betting and gambling regulated market.

·     Significantly enhances the Group's offering with a sports betting website, complementing its existing network focused on casino products. This addition will enable the Group to target a broad reach of potential sports betting players, providing content rich information and referring the players to sports betting sites.

·     By utilising the Group's tools and know how, management expects to scale up the purchased websites into additional languages and markets as well as improve the websites technologically in order to enhance revenues.

Since the Group operates over 2,000 websites worldwide, integrating the additional websites into its existing operations is expected to be relatively fast and at low cost.

The acquisition is another step in a series of domain and website acquisitions executed since the IPO earlier this year, aimed at expanding into new territories and products and further establishing a presence in fully regulated markets.

The Group plans to continue buying domains and websites as part of its ongoing growth strategy as well as to increase its presence in regulated markets.

Consideration and key terms

Under the purchase agreement, XLMedia will purchase domains and websites, including the underlying content management system, social network accounts, and related intellectual property rights. The initial consideration, of US$5.04 million (GBP 3 million) will be payable one month from closing, with the remainder payable 12 months from closing. Under the terms of the agreement, during the initial six month period from closing, the vendor will provide support, training and maintenance services as required for the smooth migration.

Commenting on the acquisition, CEO, Ory Weihs said,

"Since our IPO in March this year, we have continued to extend our network with complementary additions. With our current network focused on casino products, we see good opportunities in the market to buy additional assets in the sports betting arena. In addition, the UK market is a mature, established market where we see growth opportunities going forward.

We believe with our know-how and core competencies we will be able to optimise the new assets and integrate them into our network, as we continue to grow organically as well as through acquisitions, and enjoy the benefits of scale in this business."

For further information, contact:

XLMedia PLC Ory Weihs www.xlmedia.com	Tel: [phone]
Buchanan Jeremy Garcia/ Sophie McNulty / Clare Akhurst	Tel: [phone]
Cenkos Securities plc Ivonne Cantu/Callum Davidson	Tel: [phone]

 

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