Posted on: March 28, 2022, 07:11h.
Last updated on: March 28, 2022, 07:11h.
Boyd Gaming (NYSE:BYD) said today its Boyd Gaming Interactive unit is paying $170 million in cash to acquire Pala Interactive from California’s Pala Band of Mission Indians.
Pala Casino in California. The tribal owner is selling its Pala Interactive unit to Boyd Gaming for $170 million in cash. (Image: San Diego Union-Tribune)
Pala Interactive includes both business-to-business (B2B) and business-to-consumer (B2C) platforms. News of the purchase comes soon after Pala Interactive landed its Ontario Gaming Related Supplier (GRS) Manufacturer License. The company provides B2B services in eight states and Canada while its consumer offerings are available in Canada and New Jersey.
For Las Vegas-based Boyd, the deal brings in added technology — a coveted trait in the iGaming space these days.
The acquisition of Pala Interactive marks the next phase in the ongoing execution of our iGaming strategy, providing us full control over the technology, development and customer experience,” said Boyd CEO Keith Smith in a statement.
Boyd is financing the purchase, which is slated to close in the first quarter of 2023, with cash on hand and capital from an existing credit facility.
Benefits for Boyd
Boyd currently leverages its iconic Stardust brand for its social casino, through which members of its B Connected loyalty program can earn rewards points.
Through the purchase of Pala Interactive, the buyer gets online casino technology, an experienced management team and managed services to for customer support, fraud issues and payments. Additionally, Boyd is gaining technology relevant to the operation of real money and social casino operations and player account management as well as an in-house games studio.
“By integrating online casinos with our existing land-based operations, we will be able to further leverage and monetize our expansive customer database and the amenities of our nationwide portfolio of properties, driving growth in both our land-based and iGaming operations,” adds Smith.
More casino operators are looking to leverage online platforms because data confirm devoted users of internet offerings eventually make their way to and spend at land-based gaming venues.
The regional casino firm runs 28 gaming venues across 10 states, including 11 in its home city. It currently offers live money online casinos in New Jersey and Pennsylvania.
EBITDA Boost, No FanDuel Interference
In a presentation to investors, Boyd notes Pala Interactive generated $5 million in earnings before interest, taxes, depreciation and amortization (EBITDA) last year — a figure that’s on pace to increase in 2022.
The buyer also points out that the acquired entity’s client roster includes Gamesys, Kindred, Unibet and the World Poker Tour, among others.
Boyd adds that the acquisition of Pala Interactive has no bearing on its five percent stake in FanDuel, which serves as the casino operator’s primary exposure to sports wagering outside of its home state.