Nektan shares dip after reduced US sale
Provider forced to sell off majority stake in US subsidiary for £300k rather than £2m
Nektan shares fell 8% this morning after the firm sold off a majority stake in its US subsidiary Respin for a significant discount to the previously-agreed price.
The online casino provider announced back in December it had agreed to sell 57.5% of the shares in Respin for £2m and the provision of £300,000 in working capital to Respin by the new investor.
However, that deal fell through and a new buyer, Alternative Investment Partners Limited (AIP) has stepped in, paying £300,000 and a $800,000 provision.
Nektan said the sale would allow it to focus on its European business, while still retaining a stake in the emerging US market.
CEO Lucy Buckley added: “We are very excited about this new partnership with AIP who specialise in investing in fast growing technology businesses.
“We look forward to continuing to work closely with Respin as we firmly believe in our US mobile casino product.
“As previously announced, Respin has steadily been gaining traction in the US, signing deals with some of the biggest land-based casinos in the world and we are excited about the macro trends in the market.
“Removal of the cash burn of the US business will allow Nektan to focus on the profitability of its core European business and continue to grow the Company globally.”
Buckley said the business was on track to reach full-year EBITDA break-even.