IGT Moves into Online Social Gaming Sphere
International Game Technology (IGT), the North American gaming company which designs, supplies and manufactures electronic games equipment and systems, has confirmed that it will be acquiring the social media developer Double Down Interactive.
In this way, IGT will be practically guaranteeing its spot in the online gaming sphere.
IGT said that it would pay up to $500 for the company over a period of three years, subject to Double Down's financial performance. The first $250 million will be paid in cash, while $85 million will be paid out as retention payments over the next two years.
The final $165 million is a performance-based payment over the next three years.
"The addition of DoubleDown Interactive launches IGT into a leadership position in social gaming, extends our global reach through new mediums and leverages our unmatched expertise in game development," said Patti Hart, Chief Executive Officer of IGT.
Double Down Boasts 4.7 Million Users
Double Down was launched on Facebook in 2010 and calls itself the biggest virtual online casino.
Currently 4.7 million active members play each month through Double Down Casino on Facebook, and IGT believes that the acquisition will give it exceptional foothold in the online social gaming sphere. The added benefit is that IGT's game titles will become household names among millions of Double Down Casino players.
"We intend to derive meaningful value from this rapidly growing distribution platform that reaches a new but complementary demographic of gaming," said Hart.
The deal comes hot on the heel's of IGT's recent acquisition of the Swedish poker and gambling platform, Entraction AB.
The final stages of the Double Down acquisition deal are due to take place during IGT's fiscal year, around the second quarter.
According to the terms of the deal, the Chief Executive of Double Down, Greg Enell, will stay on as head of operations at the Seattle-based gaming group.
Statistically, 72% of IGT's revenues are generated through the US and Canadian gambling markets, while the remaining 28% is generated through other international markets.
An analyst with Normura Holdings was upbeat about IGT's move to online social gaming. "IGT now has a new, and the fastest growing distribution channel for its game content, which should allow them to attract new customers to their land based slot machines," said Harry Curtis.
"Someone playing Golden Goddess on a social website might be inclined to go and play a Golden Goddess slot machine at a land based casino."
