Inspired Entertainment Inc has confirmed that it has entered into a definitive agreement to acquire the Gaming Technology Group (“NTG”) of Novomatic UK, a division of the Austrian NOVOMATIC GROUP, for $120m.

US-based Inspired is already an established supplier of Category B2/B3 gaming terminals in the UK, while NTG is a provider of Category B3, C and D gaming terminals to pubs, arcades, motorway service areas and holiday resorts in the UK.  

Following the transaction, Inspired said it would be positioned to supply an extensive range of products and services across the UK and Europe, and beyond. Upon closing the acquisition, the firm would manage more than 75,000 gaming machines in the UK and Europe.

“The potential acquisition of NTG is transformational for Inspired, enabling us to dramatically increase the size, scale and scope of our business by combining our highly complementary, but largely non-overlapping, businesses,” said Lorne Weil, Executive Chairman of Inspired. “We expect to leverage our superior game content, technology, operational capabilities and respective footprints to augment the existing growth trends for our enterprise.”

NTG is comprised of machine operating firm Gamestec Leisure; holiday park and motorway service station machine supply company Playnation; gaming machine manufacturers Astra Games and Bell-Fruit Group; and machine developers Harlequin Gaming and Innov8 Gaming.

The casino assets of Astra Games Limited are not included in the potential transaction. At or prior to the closing of the acquisition, Astra will transfer to Novomatic UK Gaming UK Limited, a wholly-owned subsidiary of NOVOMATIC GROUP, assets to the extent related to its casino operations.

Weil continued: “Inspired and NTG currently operate in different segments but have much in common in terms of providing resources for our customers and their consumers. This combination would provide additional resources for our core businesses and combine the great content and machine portfolio from each. We expect to be able to deliver meaningful value to our shareholders as the acquisition is integrated.”

Inspired expects to achieve $12.3m to $13.3m of synergies through shared costs and increased scale. It also expects to be able to make efficient use of shared manufacturing, engineering, software development, field maintenance and customer service to drive growth and cost savings after the transaction closes. The company further expects to reduce capital deployed in the pub gaming sector following the closing of the transaction, as the sector continues its ongoing digital transformation.

Inspired added that it plans to draw on its core strengths and those of NTG to broaden offerings, bring differentiated gaming products to new sectors and geographies, accelerate key growth initiatives and offer enhanced capabilities, systems, field service and content. The addition of NTG is expected to help diversify its UK business and expand into contiguous customer segments with very little overlap of existing customers.

Inspired’s position and expertise in server based gaming is expected to accelerate NTG’s development initiatives to transition the pub gaming sector from analog to digital gaming machines.