Gaming industry analysts applaud Light & Wonder’s planned $850 million acquisition in a deal expected to close in the second quarter.
Las Vegas-based gaming equipment manufacturer Light & Wonder is acquiring a North Carolina-based slot-machine content company in an $850 million cash deal, the companies announced.
Analysts are praising Light & Wonder’s acquisition of Grover Charitable Gaming, a privately held Greenview, North Carolina, company that offers land-based, online and mobile gaming content in five U.S. states.
In addition to the $850 million purchase price, Light & Wonder will pay a four-year revenue-based earn-out of up to $200 million cash.
The deal is contingent on regulatory approvals and is expected to close in the second quarter.
“Grover Gaming is a leading player in charitable gaming, a category that has experienced significant growth in recent years,” Light & Wonder President and CEO Matt Wilson said in a release.
“This transaction complements our position as the leading cross-platform global games company by adding another compelling regulated adjacency to our profile,” he said.
Light & Wonder specializes in developing content across land-based and iGaming platforms.
“Importantly, there are exciting incremental revenue opportunities to be realized by leveraging Light & Wonder’s proven land-based gaming content to a new and loyal customer base,” Wilson said. “We look forward to continuing to partner with Grover Gaming’s customers, building on its strong dedication to customer service.”
Analysts view the acquisition as a win for Light & Wonder.
“We think the acquisition enhances LNWs growth outlook as the company looks to further penetrate adjacent markets by leveraging its existing research and analysis without taking on significant incremental costs,” gaming analyst Barry Jonas of Truist Securities wrote in a report to investors.
“Light & Wonder continues to execute on its path towards $1.4 billion in (adjusted cash flow) in 2025 but wants to penetrate gaming adjacencies as avenues for future growth. The acquisition of Grover Gaming’s assets enables LNW to leverage its content to new customers in the charitable gaming space which has high barriers to entry.”
Chad Beynon, a gaming industry analyst with Macquerie, raised Light & Wonder’s target stock price to $122 from $117 a share.
“LNW’s acquisition of Grover Gaming’s charitable gaming assets adds a long-term growth driver through expansion into a new adjacency,” Beynon said in a note to investors.
Under the terms of the agreement, Grover founder Garrett Blackwelder will collaborate with Light & Wonder to help drive the continued success of the business over the next three years.
