PlayAGS shares jumped at the news on Friday (12), closing up 25% at US$7.52. The as yet undisclosed deal by both parties has been widely reported in the media since Reuters broke the story over the weekend.
Inspired Entertainment noted recent speculation in the press and financial markets regarding a potential transaction with PlayAGS, Inc, but stated that as a matter of policy, Inspired does not comment on market rumours or speculation.
PlayAGS said that while this initial proposal had not been accepted, it remains in discussions with the interested party, the identity of which it did not disclose.
“There can be no assurance that any transaction will be completed at this price or at any other price with such third party or any other third party,” PlayAGS said.
“The company’s board of directors and management team are committed to acting in the best interests of all shareholders. The company’s policy is to not comment on market rumours and does not intend to make further comments regarding potential transactions or provide any public updates regarding proposed or potential transactions, unless required by required law or a regulatory body,” it added.
PlayAGS reported its latest second quarter earnings on August 8, 2022, showing domestic EGM recurring revenue climbing to a record US$46.2m and its premium EGM installed base nearly doubling year-on-year, growing 15 per cent sequentially. However, the company was especially hit hard by the pandemic and the servicing of debt that stood at US$574.3m at the end of June this year. The upshot being that PlayAGS is currently worth a fifth of its 2019 value, following its Apollo Capital-backed IPO in 2018.
Inspired Entertainment, on the other hand, has seen its market value grow to US$400m with a 72% jump in quarterly revenue to US$71.3m in August, as its business rebounds faster from pandemic lockdowns.
Stewart Baker, Inspired’s Executive Vice President and Chief Financial Officer, commented on the results: “We are particularly pleased with our second quarter results, given the prevailing perception of headwinds from the macro-economic environment as well as the impact from foreign exchange rates. Given our ongoing strong performance in the face of these headwinds, the long-term outlook of the company and the strength of our balance sheet, we have utilised our board-approved share buyback program to repurchase nearly 750,000 shares of Inspired common stock, as of August 9th, at an average price of US$9.73 per share (before trading expenses).”
“Moving forward, we see continued pressure from FX rates, however our underlying business has maintained the same trend. We will continue to be disciplined in our approach to capital deployment, while also focused on executing on our strategic plan to deliver profitable growth, increase cash flows and maximise shareholder value,” Baker concluded.
Source: GMB / G3 Newswire
