WEEKLY FEATURE: More M&A—SciGames Buying DEQ

Sat, Sep 3, 2016

Another supplier is being taken off the table. Scientific Games has snapped up DEQ Systems, adding more proprietary technologies to its Shuffle Master brand and enhancing the positioning of the slots and systems giant as the store that sells everything. DEQ most successful game is EZ Baccarat (l.), where the player pays no commission.

Slots and systems giant Scientific Games is expanding its reach into table game technologies with a deal to buy DEQ Systems.

The all-cash transaction totals C$21 million, or C$0.38 per share of Quebec-based DEQ.

DEQ generated C$9.5 million in the financial year ended May 31, principally on an innovative progressive game platform called EZ Baccarat. The company has around 800 of the games placed in 150 casinos worldwide.

Las Vegas-based SciGames sees the acquisition as enhancing its positioning as a one-stop-shop for casino operators, adding more proprietary table games and table progressive systems to the Shuffle Master brand along with a high-margin base of recurring revenue via the licensing of DEQ’s intellectual property.

“The DEQ team has grown a fantastic business focused on providing revenue-generating and entertaining solutions for casino operators around the world,” said Roger Snow, SciGames’ senior vice president-Table & Utility Products.

DEQ Systems President and CEO Joseph Bertolone said, “We look forward to working closely with the Scientific Games team to ensure a smooth transition and continued innovation for gaming operators and their players around the world.”

The deal is expected to close in the fourth quarter, pending the assent DEQ’s shareholders and regulatory approvals, and be accretive to earnings and operating cash flow for Scientific Games in 2017.