One of the world’s major online gambling technology providers, Sportech, has announced its intention to shift to the AIM section of the London Stock Exchange in favour of the premium segment.
The move would be big news for the industry, with the giant tech company having a hand in many of the nation’s top gambling sites.
According to James King from the site CasinoSites.org: “Top brass at Sportech seem to think that AIM would be a superior market given the current situation the company finds themselves in. Offering much more transactional room for manoeuvre, the shift would allow Sportech to get deals done faster and more efficiently, with those listed on the official list.”
“This latest move comes off the back of a terrible year for Sportech, with COVID-19 having left them in awful shape. They had to sell off two of their key brands and now, by shifting to the AIM, Sportech is quite clearly looking to cut costs and red-tape associated with executing transactions on the premium segment of the LSE.”
Let’s now take a deeper look at Sportech’s proposed move to the AIM, assessing why the move has come about as well as its potential impacts going forward.
Will the move go ahead?
At the moment, the company is trading at 20p per share on the Official List of the Financial Conduct Authority. This recent announcement indicates a desire to shift to the LSE’s AIM. To complete the move, Sportech would need to gain the thumbs up of a minimum of 75% of its shareholders, who will hold a meeting on 29 June to assess the possibility.
Why is the move being proposed?
In April, the company announced a drop of £12.8m in the year 2020, with revenue falling off by more than 40% year-on-year to £20m.
This likely came as a result of the company selling both its Global Tote brand and the Bump 50:50 lottery name. Clearly, the impact of COVID-19 on the company is continuing to impact Sportech and this latest news of a move to London’s AIM could be reflective of a scramble to get deals done quicker and at a lower cost than previously.
What is Sportech?
Sportech have pumped plenty of cash into their Tote betting tech down the years. Having also diversified into the world of lottery and raffle businesses, the company has carved out an important spot for itself in the pantheon of igaming technology providers.
Much of their work revolves around creating innovative new products for both land based and digital betting, with the company having expanded significantly across the globe in the last ten years as the online and land based casino business goes from strength to strength.
Overall, it can be said that news of Sportech’s proposed move to London’s AIM indicates a change of direction for the company. Having offloaded some key assets to raise funds post-COVID-19, they are now looking to get transactions done quickly and more efficiently than a spot on the premium segment would allow.