Posted on: November 1, 2022, 05:02h.
Last updated on: November 1, 2022, 05:43h.
Boyd Gaming (NYSE: BYD) announced today that it has put the finishing touches on its previously announced $170 million, all-cash acquisition of Pala Interactive.
The regional casino operator said in March its Boyd Gaming Interactive unit was buying Pala Interactive from California’s Pala Band of Mission Indians. The deal closed slightly ahead of schedule, as it was originally expected to be finalized in the first quarter of 2023. Boyd financed the purchase with cash on hand and capital from an existing credit facility.
Online casino gaming is an attractive growth opportunity for our Company, and the acquisition of Pala Interactive provides us with the technology, products and expertise to create a profitable regional online casino business,” said Boyd CEO Keith Smith in a statement.
Pala Interactive includes 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.
Pala Could Bolster iGaming Ambitions
Boyd, which is one of the dominant operators of locals casinos in the Las Vegas Valley, has a burgeoning online casino footprint, which the Pala Interactive purchase is expected to fortify.
Through the purchase of Pala Interactive, the buyer gets online casino technology, an experienced management team, and managed services 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.
Boyd operates 28 casinos in 10 states, including 11 in the Las Vegas area. Its live money online casino offerings are available in New Jersey and Pennsylvania. Boyd currently leverages its iconic Stardust brand for its social casino, through which members of its B Connected loyalty program can earn rewards points.
“We look forward to working with the Pala Interactive team in executing our online casino gaming strategy, which will complement our existing land-based operations and further expand our nationwide customer base,” added Smith in the statement.
Pala Interactive Already Profitable
Notably, Boyd isn’t taking on a money-losing entity with Pala Interactive. Rather, the opposite is true, as the internet gaming unit generated $5 million in earnings before interest, taxes, depreciation and amortization (EBITDA) last year — a figure that’s expected to increase in 2022.
In announcing the deal in March, Boyd noted 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.
Pala Interactive has an impressive client roster, including Gamesys, Unibet, and the World Poker Tour (WPT), among others.