- Purchase price valuation is 50% below peergroup;
- A further increase to 100% is planned short term;
- Former Gamigo shareholders will receive shares with a 25 months lock-up period.
Media and Games Invest plc is acquiring 1.05 million gamigo shares, representing approximately 45.5% of the total outstanding shares, thereby increasing its stake in gamigo AG from 53% to 98%.
The agreements, which were approved today by the Gamigo Supervisory Board and the Board of MGI, were signed today. The transaction is expected to be completed within the coming days. It is planned to also acquire the remaining Gamigo shares thereafter.
In the 12-month period from 1 October 2018 to 30 September 2019, Gamigo generated net revenues of EUR 56 million and EBITDA of EUR 16 million. Over the past five years, the company has grown by an average of 32% in terms of revenue and 64% in terms of EBITDA.
The purchase price of EUR 16.5 million in cash and up to 18.2 million MGI shares represents a valuation of seven times EBITDA based on the 12-month period ending September 30, 2019. Thus, the purchase price is about 50 percent below the valuation of comparable companies. According to current data from E&Y Corporate Finance, gaming companies achieve an average valuation of 13.5 times EBITDA.