NorthStar Gaming (NSG) has announced the completion of a strategic investment from Playtech, a gambling software developer, who will invest C$12.2m (US$9.1m) into NSG via convertible debenture. This is a type of long-term debt issued by a company that can be converted into shares of equity stock after a specified period.
This investment will run concurrently with a reverse takeover (RTO) and a fundraising effort associated with it, that has accumulated gross proceeds of C$22.3m. Playtech will offer its services as a strategic investor and advisor to the Ontario-based online casino and sportsbook operator.
The RTO relates to the NSG’s takeover of Baden Resources, a mineral exploration company. NSG expects to complete the RTO quickly and once the application process is finished, it will begin trading on the TSX Venture Exchange.
Michael Moskowitz, CEO and a Founding Partner of NorthStar Gaming, commented: “Playtech’s unparalleled expertise in the gaming industry will help NorthStar accelerate our growth and rapidly expand our user base. With the additional investment, we look forward to expanding our market share across Ontario, further enhancing our premium, content-driven experience for consumers.”
The NSG warrants will have a five-year term, beginning from the date of the conversion of the debenture. NSG common shares received by Playtech upon conversion will be exchanged for Baden common shares in connection with the RTO.
Playtech enjoyed a fiscally successful 2022, updating its adjusted EBITDA outlook to €400m ($428.6m) for 2022 last month. The developer said the driving force for this improved financial outlook has been the success of its B2B and Snaitech businesses.
