By Clyde Mooney – editor Australian Hotelier

American gaming giant Bally Technologies has announced the completion of its purchase of leading social gaming site Dragonplay in a deal worth around $100 million. 

Launched in 2010, Dragonplay is ranked as a top-grossing player in the social casino genre, with approximately 700,000 active daily users and nearly three million monthly active users (MAU).

Bally says the strategic move “provides a new channel to leverage proprietary slot and table game content”, and expects Dragonplay to be earning its keep for shareholders by 2015. 

Total consideration comprises $51 million in upfront cash plus the amount of working capital, paid to Dragonplay shareholders in exchange for all equity, while another $49 million will be paid on earn-out consideration and employee incentives subject to the social gamer meeting financial targets. 

Bally CEO Richard Haddrill gave a nod to Dragonplay’s performance history on Google Play, acknowledging its successful and consistent “ability to acquire, monetise and retain” social gamers. 

“We expect this strategic acquisition to help position Bally at the forefront of social casino gaming by leveraging our world-class content, including proprietary table games and award-winning video slots, on Dragonplay’s increasingly popular social casino,” said Haddrill. 

“Additionally, with the majority of its revenues generated from smartphones and tablets, Dragonplay has proven remarkable foresight and leadership in the mobile space, which is the fastest growing segment of social gaming.”  

Australia’s Gaming Technologies Association (GTA) expects the deal is just the start of traditional gaming businesses moving into the social gaming arena.

“It is estimated that 750 million people worldwide play social games and that this will continue to increase rapidly,” said GTA CEO Ross Ferrar. 

“The social element typically means people play with or directly against their friends, or they participate in leader boards and chat rooms or share and compare progress via a social network.

“A social gamer can choose to buy, using real money, additional features or ‘virtual goods’ like extra lives, tools or maps which expand and enrich the game experience, but the vast majority can be played without purchasing these extras.”

Dragonplay generated over $10 million (EBITDA) for the 12 months to 31 March, 2014. 

The Shout Team

The leading online news service for Australia's beer, wine, spirits and hospitality industries.

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