Bally’s Corporation said on Wednesday it has agreed to sell its interactive business in Asia and other international markets as part of a broader strategy to focus on its North American and European operations.
The deal, disclosed in a U.S. Securities and Exchange Commission filing dated Oct. 31, involves a new entity formed by members of Bally’s own management within the “Carved-Out Business,” the name Bally’s has given to the assets included in the sale.
Under the agreement, Bally’s will license certain intellectual property to the new entity for five years, with an option for extension. Bally’s will provide transition services but will have no involvement in the management, operations, or governance of the carved-out business after the sale.
The sale aligns with Bally’s strategy to streamline operations and allocate resources to core markets. “The transaction is intended to allow Bally’s to focus its capital and resource allocation on North American and European business,” the company said in the filing.
The financial impact of the transaction is expected to be limited, with Bally’s projecting a modest decline in adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) and free cash flow. The company stated it expects these declines to be offset by increased profitability margins through IP licensing and cost-reduction measures.
The divestment comes amid pressure from major shareholder K&F Growth Capital, which has previously expressed concerns about Bally’s presence in Japan. Earlier this year, K&F Growth recommended a sale of Bally’s online assets in Japan, citing regulatory challenges.
“A US public company should not be in the business of supplying gaming equipment and operations to the Japanese market under the country’s current regulatory framework,” K&F said.
Bally’s online assets in Japan include the operation of four brands – CasinoSecret, Vera&John, InterCasino and Yuugado – in the market. Bally’s delivers third-quarter results on Wednesday, and possible that at that time the company will provide more color on the sale of these assets.
Bally’s CEO Robeson Reeves has acknowledged challenges in Japan, where currency devaluation and customer engagement issues have impacted business performance. “Capturing new audience has been more challenging. That’s actually been the real issue. That has definitely stifled the sort of willingness to play,” Reeves said.
The sale of the Asian business could pave the way for the seller to focus on important land-based projects. As part of its North American expansion, Bally’s is developing a new property in Las Vegas, timed to open alongside the Oakland Athletics’ new stadium in 2028. Phase one of the project will include a casino, hotel tower, and several restaurants, with additional amenities expected to follow.
Original article: https://www.yogonet.com/international/noticias/2024/11/04/84180-bally-39s-sells-asian-interactive-business-to-focus-on-north-america-europe
