Swedish betting firm Cherry AB has announced that they have agreed to purchase online betting operator ComeOn Malta Ltd for a price of 10 times the operating profit for the company in the 2016 fiscal year.
The initial purchase will see Cherry purchasing 49% of the shares in ComeOn, with the company having the remaining 51% of the company between October 1st and December 31st of this year. The first payment will be for €80 million, with 49.6% of that total in cash and the rest payable in shares. The total paid for the operator could be worth €280 million at the maximum.
Commenting on the agreement Cherry CEO Fredrik Burvall said, "Both Cherry and ComeOn are growing considerably faster than the market as a whole, which facilitates further investments in existing brands and continued expansion in new markets. We will add several strong brands and will profit from the strong entrepreneurial spirit within ComeOn."
Cherry Spokesperson Hans Martin Nakkim also commenting, adding: "We are looking forward to joining forces with Cherry. Just like us, Cherry is growing quickly with a multi-brand strategy and we see a lot of potential synergies between the companies. We look forward to staying operationally involved with the new ownership, while still having a big stake in the future growth of the consolidated Cherry."
Last week Cherry revealed that they were halting trading, but declined to give a reason in order to not influence share price until the agreement was in place.
ComeOn currently has 1.1 million customers, with 133,324 of those customer active, and brought in a profit of roughly €13 million for the year, and is expected to bring in around €20 million in profit this year.
The deal will be subject to regulatory approval as well as shareholder approval, and Casino Listings will update this story as more developments arise.