Gambling.com Group is set to acquire Freebets.com for up to US$42.5m after posting record quarterly revenue in Q4.
Revenue for the final quarter of 2023 rose 52 per cent to $32.5m, helping push full-year revenues to $108.7m, up 42 per cent.
Net income for Q4 was $6.4m and $18.3m for the full year, while the adjusted EBITDA figures for the respective reporting periods were $10.6m, up 54 per cent on Q4 2022, and $36.7m, up 53 per cent on FY22.
Gambling.com Group has subsequently posted 2024 revenue guidance of between $129m and $133m while forecasting adjusted EBITDA of between $44m and $48m.
Charles Gillespie, CEO and co-founder of Gambling.com Group, said the Q4 results “extended our strong record of delivering high top-line growth and attractive margins.”
He added: “With consistent execution over the years, and especially over the past four years in North America, we have established one of the strongest and highest growth performance marketing businesses in the online gambling industry.”
Fourth quarter and full-year North American revenue increased by 103 per cent and 69 per cent, with growth driven by new state launches, increases in same-state sales and “our blossoming media partnership initiatives,” Gillespie said.
The acquisition of FreeBets, which is expected to close at the beginning of April, will cost between $37.5m and $42.5m. An initial $20m will be paid upon closing, with $10m paid on the six-month anniversary of closing.
The remaining portion of between $7.5m and $12.5m will be paid one year after closing, subject to the performance of the assets during the remainder of 2024.
“This acquisition will provide us with another big brand and assets that complement our existing website portfolio in a number of our key-focus markets, enabling us to drive further growth which is both high margin and highly accretive,” said Gillespie.
“By operating these assets on our technology platform, we expect to unlock their full potential. We are confident that this latest acquisition will create incremental shareholder value in the same way we have done with previous acquisitions.”
Marcus Rich, chair of XLMedia, said: "The board believes the sale of these assets, which is approximately two times the current market capitalisation of the whole company, is an excellent outcome for XLMedia and its shareholders.
"Importantly, this transaction will allow the company to clear legacy liabilities, provide working capital and return cash to shareholders."
