Gambling.com Acquires Odds Holdings for Growth

Gambling.com Group, a prominent player in the digital marketing services sector for the global online gambling industry, has recently announced a landmark acquisition of Odds Holdings, Inc., the parent company of OddsJam. This move further solidifies Gambling.com Group’s position in the market while diversifying its revenue streams. The acquisition not only enhances the company's growth prospects but also establishes new recurring revenue sources from both consumer subscription products and enterprise clients.

Acquisition Overview

The acquisition agreement, which was made public in December 2024, is valued at $80 million in initial consideration. In addition, the transaction includes an earnout provision, which could see an additional $80 million based on the performance of Odds Holdings through the end of 2026. The deal allows Gambling.com Group to expand its footprint in the online gambling ecosystem, capitalizing on the robust technology platform developed by Odds Holdings.

Odds Holdings operates a state-of-the-art technology platform that delivers real-time odds data. This platform serves as the backbone for its services across various consumer and enterprise brands. Gambling.com Group’s acquisition aims to enhance its market offerings by incorporating this platform’s cutting-edge capabilities into its broader portfolio.

A Technological Powerhouse

One of the most significant advantages of the acquisition is the technology behind Odds Holdings, which powers real-time odds data with exceptional accuracy and minimal latency. The platform processes over one million requests per second and handles multiple terabytes of data daily across nearly 300 sportsbooks, positioning it as one of the most advanced systems in the industry.

OddsJam, the flagship brand of Odds Holdings, offers premium, real-time odds information through a consumer-facing website and app, helping sports bettors make informed, data-driven decisions. The company also serves enterprise clients, providing comprehensive odds data and analytics for various sports betting use cases, a service that Gambling.com Group intends to leverage to expand its own enterprise business.

Financial Impact and Strategic Rationale

The acquisition is expected to be immediately accretive to Gambling.com Group’s financial results upon closing, which is scheduled for January 1, 2025. Gambling.com Group anticipates that the addition of Odds Holdings will contribute new revenue, adjusted EBITDA, and free cash flow streams. These new streams are projected to have an even higher margin profile than the company’s already strong operating performance.

In 2024, Odds Holdings is projected to achieve around $26 million in revenue and $12 million in adjusted EBITDA. Gambling.com Group anticipates that, with its oversight, the adjusted EBITDA from Odds Holdings will increase by at least 20% in 2025, boosting its profitability even further.

This acquisition marks a strategic and significant step towards Gambling.com Group's goal of achieving $100 million in annual adjusted EBITDA, a target the company has set for the near future. The integration of Odds Holdings’ cutting-edge technology and enterprise services is poised to accelerate Gambling.com Group's growth trajectory.

Expanding Market Reach

The acquisition also broadens Gambling.com Group’s market reach, enabling the company to offer a wider range of products and services to both consumer and enterprise clients. This move aligns with the company’s long-term strategy of diversifying its revenue streams beyond traditional affiliate marketing in the online gambling space.

Gambling.com Group’s CEO, Charles Gillespie, emphasized the strategic importance of the acquisition in a statement, saying, “The acquisition of Odds Holdings will immediately provide us with additional, recurring revenue streams, which are independent of our market-leading online gambling affiliate business. This is consistent with our strategy to expand our footprint in the online gambling industry.”

In addition, the acquisition allows Gambling.com Group to leverage its existing partner relationships to significantly grow the Odds Holdings enterprise business. By utilizing the company's established network and expertise, Gambling.com Group is well-positioned to accelerate Odds Holdings’ technology and data-driven insights, expanding their reach to a larger audience of online bettors, both in North America and internationally.

Leadership and Team Integration

Following the completion of the acquisition, the team at Odds Holdings, including the founders of OddsJam, Ankit Goyal and Alex Monahan, as well as CEO Matt Restivo, will join Gambling.com Group. This integration strengthens Gambling.com Group’s leadership team and brings additional expertise in sports betting technology and data analytics.

Odds Holdings’ CEO, Matt Restivo, expressed excitement about the merger, noting, “By joining forces with Gambling.com Group, we are poised to scale our technology and reach an even larger audience. We look forward to working with Charles, Kevin, and the entire Gambling.com Group team to enhance the online gambling experience for our customers.”

Financial Structure and Funding

The initial purchase consideration of $80 million will be paid through a combination of $70 million in cash and $10 million in Gambling.com Group ordinary shares. To finance this transaction, Gambling.com Group has entered into a debt financing commitment with Wells Fargo Bank and Wells Fargo Securities. The company has secured a commitment to arrange a senior secured term loan and a revolving credit facility worth at least $100 million. It plans to finance the cash portion of the transaction by utilizing funds from its expanded credit facility.

The contingent consideration, which could amount to an additional $80 million, is tied to the performance of Odds Holdings through the end of 2026. In addition, Gambling.com Group has the option to settle up to 50% of any contingent payments in ordinary shares, providing flexibility in managing its financial resources.

Legal and Advisory Support

Gambling.com Group has been advised by White & Case LLP as legal counsel, while Oakvale Capital LLP has acted as the sell-side financial advisor to Odds Holdings. Cruz-Abrams Seigel LLC has also provided legal counsel to Odds Holdings in connection with the transaction.

Conclusion

The acquisition of Odds Holdings marks a significant milestone in Gambling.com Group’s growth strategy, positioning the company for continued success in the rapidly expanding online gambling industry. By integrating cutting-edge technology and data-driven products, Gambling.com Group is poised to enhance its market offerings and accelerate its path to achieving $100 million in annual adjusted EBITDA.

With the expected increase in recurring revenue, the addition of enterprise clients, and the integration of Odds Holdings’ team and technology, Gambling.com Group is well-equipped to strengthen its leadership position in the online gambling sector. The merger represents a strategic expansion that aligns with the company’s vision for long-term growth and shareholder value.

FAQs

What is the main objective of Gambling.com Group’s acquisition of Odds Holdings?
The acquisition aims to expand Gambling.com Group’s market presence by adding recurring revenue from consumer subscription products and enterprise clients, enhancing its growth prospects.

How much is Gambling.com Group paying for Odds Holdings?
Gambling.com Group is paying an initial consideration of $80 million for Odds Holdings, with the potential for an additional $80 million based on performance metrics through 2026.

What is the technology behind Odds Holdings?
Odds Holdings operates a state-of-the-art technology platform that delivers real-time odds data with minimal latency, processing over one million requests per second and handling terabytes of data daily.

What will be the impact of this acquisition on Gambling.com Group’s financials?
The acquisition is expected to be immediately accretive to Gambling.com Group’s financial results, contributing new revenue, adjusted EBITDA, and free cash flow streams with higher margins.

Who are the key people joining Gambling.com Group after the acquisition?
The key people joining Gambling.com Group include the founders of OddsJam, Ankit Goyal and Alex Monahan, as well as Odds Holdings CEO, Matt Restivo.

How will Gambling.com Group benefit from this acquisition?
Gambling.com Group will benefit from expanded technology, new recurring revenue streams, and enhanced enterprise business, along with a larger audience through OddsJam.

What are the financial expectations for Odds Holdings in 2024?
Odds Holdings is expected to generate approximately $26 million in revenue and $12 million in adjusted EBITDA for 2024.

How will the contingent consideration in the deal work?
The contingent consideration of up to $80 million is based on Odds Holdings’ performance, specifically doubling its adjusted EBITDA in 2026 compared to 2024.

How will Gambling.com Group finance the acquisition?
The acquisition will be financed through a combination of $70 million in cash and $10 million in Gambling.com Group ordinary shares, with borrowings from an expanded credit facility.

What is the expected timeline for the acquisition to close?
The acquisition is expected to close on January 1, 2025, subject to customary closing conditions.