International Game Technology (IGT) is looking to ‘unlock true value’ by examining strategic alternatives for its Global Gaming and PlayDigital segments.
The NYSE firm’s Board of Directors detailed that these alternative options include but are not limited to a sale, merger or spin off of the divisions. However, maintaining and further investing in the businesses is also being considered as a direction to take.
London-based IGT emphasised that no decision has been made as of yet, that there is no confirmed timeline for the review, and that it cannot assure whether this exploration of alternatives will result in a transaction, whether that be a merger or sale.
Marco Sala, IGT Executive Chair, said: “Over the last three years, IGT has sharpened its strategic focus by reorganising around core product verticals, monetizing non-core assets, reducing structural costs and significantly improving its credit profile.
“We believe the intrinsic value of IGT’s market-leading businesses and diversified cash flow profile is not currently reflected in our stock price and the timing is right to assess opportunities that may enhance value for IGT’s shareholders.”
Although asserting that no decision has been made yet and may not be made ever, IGT did confirm which firms have taken on advisory roles as and when its review commences.
Financial advice will be provided by Deutsche Bank, Macquarie Capital and Mediobanca, whilst Sidley Austin and White & Case will provide legal counsel.
The announcement may come as a surprise to some as IGT’s Global Gaming and PlayDIgital units performed well during the first quarter of the year. The duo recorded a 17% revenue uptick to $381m and $55m respectively.
“IGT is a global leader with deep expertise in lottery, land-based gaming, iGaming and sports betting,” remarked Vince Sadusky, IGT CEO.
“We remain focused on the execution of our growth objectives and multi-year goals outlined in our November 2021 Investor Day as we undertake this review and evaluation of strategic alternatives. Regardless of the outcome of this process, IGT is well-positioned to deliver on its long-term growth and profit targets.”