NEW YORK (The Deal) -- Shares of Multimedia Games (MGAM) rallied Monday morning on the news that the slot machine maker had reached a deal to be acquired by Las Vegas casino cash provider Global Cash Access Holdings (GCA) for $1.2 billion.
Global Cash will pay $36.50 per share in cash for all outstanding shares of Multimedia Games, representing a 31% premium over the target's closing share price of $27.78 on Friday, Sept. 5. Global Cash intends to finance the acquisition using debt financing and available cash.
The combined entity is expected to create $30 million in synergies, earn about $800 million in revenue, and have about $217 million in adjusted Ebitda, based upon the twelve months ended June 30, the companies said in a Monday statement. The acquisition is expected to be immediately accretive.
Multimedia Games, of Austin, Texas, makes and distributes technology for the Native American and commercial casino industry, including video slot and reel-spinning slot machines and products serving the lottery market. The company also licenses games from gaming companies including WMS Industries, a subsidiary of Scientific Games (SGMS) , and Aristocrat Technologies.