Evolution AB, a leading gaming solutions provider, has announced its decision to transfer up to 500,000 own shares to the sellers of Big Time Gaming, a prominent gaming company famous for slot machine development. This decision, made during Evolution AB’s Annual General Meeting, aims to secure the delivery of shares for earn-out considerations during 2023 and 2024.
Background on BTG Acquisition
Evolution AB acquired BTG to strengthen its position in the iGaming industry. The acquisition agreement included earn-out considerations for BTG sellers based on the company’s EBITDA development during 2023 and 2024.
An earn-out is a mechanism used in acquisitions to bridge the gap between the seller’s expected price and the buyer’s offered price. It involves additional payments to the seller based on the acquired company’s future performance, in this case, BTG’s EBITDA growth during 2023 and 2024.
Payment in Shares
Evolution’s current assessment estimates the earn-out consideration for 2023 to be approximately EUR 80 million. As part of the agreement, 30% of this amount will be paid in Evolution AB shares, resulting in around 215,000 shares being transferred to the sellers of BTG.
Flexibility and Final Outcome
The decision to transfer a maximum of 500,000 shares provides Evolution AB with flexibility concerning the final earn-out calculation. The actual number of shares transferred may be lower than this maximum, but not higher. The board of directors will determine the final number of shares to be transferred based on the final outcome of the earn-out considerations.
This strategic move by Evolution AB not only ensures that the BTG sellers are fairly compensated for their company’s performance but also demonstrates the company’s commitment to creating value for its shareholders.