Aristocrat Leisure Limited
ALL Details
Aristocrat Leisure Limited (Aristocrat) has entered into a binding agreement to acquire 100% of Plarium Global Limited (Plarium), a social gaming company, for total consideration of an upfront amount of US$500m cash, and an earn-out arrangement payable to Plarium shareholders following the end of calendar years 2017 and 2018 respectively, based on 10x Last Twelve Months (LTM) EBITDA at year end (less previous consideration amounts already paid in prior periods). The total transaction consideration implies a multiple of 10x LTM EBITDA at year end.Plarium is a privately owned free-to-play mobile, social and web-based game developer, headquartered in Herzliya, Israel and has over 1,200 employees across five genre-specific studios as well as multiple offices throughout Europe, Israel and the US.
The acquisition of Plarium allows Aristocrat to expand its addressable market into logical adjacent segments in the fast-growing mobile gaming market. This immediately expands addressable market from ~US$3.2bn in the Social Casino segment, to ~US$25.4bn when including the Strategy, RPG and Casual segments. It also provides with a stronger platform to target the ~US$43.6bn overall mobile and web games market as growth segments. The acquisition of Plarium increases pro forma Digital revenue contribution from 14% to 22% for the year ended 31 March 2017. We maintain an “Expensive” recommendation on the stock at the current price of $21.26
.png)
ALL daily chart; (Source: Thomson Reuters)
Disclaimer
The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkine.com.au and associated pages are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). The information on this website has been prepared from a wide variety of sources, which Kalkine Pty Ltd, to the best of its knowledge and belief, considers accurate. You should make your own enquiries about any investments and we strongly suggest you seek advice before acting upon any recommendation. Kalkine Pty Ltd has made every effort to ensure the reliability of information contained in its newsletters and websites. All information represents our views at the date of publication and may change without notice. To the extent permitted by law, Kalkine Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services. There may be a product disclosure statement or other offer document for the securities and financial products we write about in Kalkine Reports. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product. The link to our Terms & Conditions has been provided please go through them and also have a read of the Financial Services Guide. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.