Austin, Texas-based slot manufacturer Multimedia Games is acquiring PokerTek, Inc., the producer of automated table games headed by the PokerPro multi-player electronic poker game. PokerTek also produces automated multi-player blackjack and baccarat games.
Multimedia is paying $1.35 per share in cash for the acquisition.
Multimedia CEO Patrick Ramsey announced the transaction, for which the company has already spent $13 million, as part of the slot-maker’s quarterly earnings announcement. In addition to adding PokerTek revenue that was $5.5 million over the past year—85 percent of which came from recurring-revenue deals with casinos—Ramsey noted that the transaction gives Multimedia an instant entry into the Macau gaming market.
“This proposed transaction represents an excellent opportunity for Multimedia Games to expand our product portfolio,” Ramsey said in a statement.
PokerTek’s board of directors unanimously approved the merger agreement with Multimedia Games, and has recommended that the company’s shareholders adopt the merger agreement. Assuming the satisfaction of conditions and regulatory approvals, the transaction is expected to close by the end of the year.
“Combining with Multimedia Games provides our shareholders with the opportunity to receive a healthy premium for their shares, and is an ideal situation for our customers, employees and other commercial partners,” said PokerTek CEO Mark Roberson. “PokerTek and Multimedia Games share a similar operating philosophy and culture, focusing on superior customer service and delivering products that generate strong returns for casino operators. As part of the Multimedia Games organization, we believe further development of innovative products and solutions will address the growing demand for eTables from casino customers and players worldwide.”
Ramsey added, “With eTable growth accelerating in domestic and international casinos, acquiring PokerTek represents an excellent opportunity to expand our product portfolio. We believe the PokerPro product is an excellent complement to our existing business, and that we can expand the penetration of PokerPro in North America by leveraging our strong domestic manufacturing, sales and service capabilities.
“Further, with a growing installed base of gaming positions internationally, this transaction represents a solid entry point to further diversify our revenue and geographic base. This transaction reflects Multimedia Games’ strategic emphasis on offering leading products that resonate with our customers’ players and increasing our share of the casino gaming floor.”
