April 28, 2022 Legal, Technology, iGaming

GAN updates strategic plans

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Company completes $30m term loan, will repurchase stock.

GAN Limited, a North American B2B technology provider of real money internet gaming solutions and an international B2C operator of internet sports betting, on Thursday provided an update on several strategic initiatives.

Karen Flores, the company’s Chief Financial Officer, said it successfully completed a $30m term loan with Beach Point Capital.

The credit agreement provides for up to $30m in aggregate principal amount of secured term loans, which accrue interest at a floating rate equal to (i) 3-month SOFR (subject to a 1.00% floor) plus (ii) 9.5% per annum, payable quarterly in arrears.

The secured loans mature four and one-half years following the closing date, or October 26, 2026. Flores said GAN plans to provide further details when it reports its first quarter results for the quarter ending March 31, after market close on Monday, May 16.

Second, she reported GAN is poised for near-term opportunistic implementation of its previously announced, $5m share repurchase authorization following public disclosure of first quarter results.

The company recently began implementation of cost controls which, along with other strategic initiatives, Flores asserted are expected to accelerate adjusted EBITDA generation and improve profitability.

Finally, the company announced that Coolbet’s hold, or sports margin, for the first quarter improved sequentially and was within the historically normalized range of approximately 7%.

According to Flores, these actions reflect the company’s commitment to driving growth, improving profitability and maintaining a well-capitalized balance sheet. She said the new capital will be focused on funding existing high-return B2B investments and future opportunistic investments.

“Today’s announcement ensures that we have the capital available to drive improved shareholder returns going forward,” Flores said in a statement. “The incremental flexibility provided by the term loan allows us to execute our balanced capital allocation plan centered around investing in our B2B offering, growing Coolbet and our B2C presence, and returning capital to shareholders during a time when we believe our share price undervalues the long-term opportunities we have ahead of us. We are simultaneously taking steps to accelerate our path to improved adjusted EBITDA generation and profitability as we are acutely focused on our margin profile and efficiency measures.”

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