Playtech plc (LON:PTEC), the leading platform, content and services provider to the online gaming industry, has announced a landmark strategic partnership with Hard Rock Digital, the exclusive, global vehicle for interactive gaming and sports betting for Hard Rock International and Seminole Gaming.
Under the partnership, HRD will license a range of the Company’s proven technology solutions and iGaming content to deliver the authentic experience customers have come to expect across Hard Rock’s global ecosystem of entertainment, hospitality and bricks and mortar casinos. In the U.S. and Canada, HRD’s customers will enjoy a variety of Playtech’s iGaming content offering including market leading slots, RNG and live dealer table games through HRD’s existing proprietary platform and technology offering. These products will also be enjoyed outside of the U.S. and Canada where HRD will also have access to additional software and services solutions from Playtech including its IMS player management platform and certain ancillary services including operational, customer support, payment advisory and marketing services.
The Company will supply its products and services predominantly on a revenue share basis under long-term commercial agreements.
Alongside these commercial arrangements, Playtech has also invested $85 million (c. €80 million) in exchange for a low single digit % minority equity ownership stake in HRD.
The proceeds from Playtech’s investment will predominantly be used to help fund HRD’s continued global expansion. Hard Rock branded online and retail sports betting and iGaming is currently being operated in select U.S. states, as applicable, including Arizona, Indiana, Iowa, New Jersey, Ohio, Tennessee, and Virginia, with the expectation for additional launches in the future. HRD also plans to extend its online sportsbook and iGaming offerings to select international markets over the next several years. Hard Rock’s global brand strength and recognition combined with Playtech’s broad international market knowledge and software and services offering provide an exciting platform for international expansion. Additionally, Hard Rock’s extensive and expanding global operating footprint of cafés, hotels and casinos positions HRD as the only operator with a truly global omni-channel opportunity.
The Company expects minimal impact from this agreement on its B2B segment results in FY2023. Contribution to B2B revenues is expected to increase in FY2024 and thereafter as HRD continues to increase penetration in established markets and as additional markets come online.
Mor Weizer, Playtech CEO said: “The Playtech team is thrilled to announce our strategic partnership with HRD. Hard Rock International has cemented itself as a marquee name worldwide, not just in gambling, but more widely in entertainment. HRD will combine the strength of this global brand with a proven management team, some of whom we at Playtech have known for many years and believe to be among the strongest in the online gambling industry.
For Playtech, this partnership significantly advances our position in the North American market and is very much in line with our B2B strategy.”
“This partnership will act as an accelerator to Hard Rock Digital’s planned strategic initiative to expand its online gaming offerings to international markets, becoming the first operator with a global omni-channel offering under a singular, irreplaceable brand,” said Jim Allen, Chairman of Hard Rock International and Chairman of the Board of HRD. “This announcement only reinforces our commitment to lead innovation in the gaming industry and expand the ‘Hard Rock’ experience worldwide. We look forward to providing an authentic, digital experience for Hard Rock’s global fan base within a comprehensive, omni-channel offering.”
By virtue of customary shareholder rights afforded Playtech, the Company’s investment in HRD constitutes a Class 2 transaction for the purposes of the UK Listing Rules. The transaction is not subject to shareholder approval. As at 31 December 2022, the unaudited gross assets of HRD were $69.4 million. For the twelve months ended 31 December 2022, the unaudited net loss before tax attributable to HRD was $76.3 million.
