Cherry AB acquires Almor Holdings’ German-facing online gambling brands

cherry-germany-kingplayer-sunmaker-sunny-player-casinoMalta-licensed online gambling operator Cherry AB has acquired Almor Holdings Ltd.’s German-facing online casino and sports betting brands.

On Thursday, Cherry announced it had struck a deal to acquire 71% of the Malta-based Amor’s shares for €4.6m (half-cash, half Cherry shares). Cherry has the option to acquire the remaining 29% within the next four years and eight months in exchange for either cash or Cherry shares.

Almor’s German-facing brands include Sunmaker, Sunny Player Casino and Kingplayer, which together had 55k active customers in the first five months of 2015 and generated net gaming revenue of €11.1m and profit of €1.2m in 2014. Almor’s existing management team will continue to run the business as well as offer support to Cherry’s existing German-language operations.

Cherry CEO Fredrik Burvall said the deal, which includes the right to Almor’s May and June earnings, would start paying off more or less immediately. Burvall said the acquisition would transform his company into “a major online casino player in this major European market.”

Companies like Cherry, which holds an online casino license issued by the German state of Schleswig-Holstein, are no friends of Lotto Hessen boss Dr. Heinz-Georg Sundermann, who used his company’s H1 2015 report to blast online operators “from Malta or Gibraltar” serving German customers.

Lotto Hessen reported revenue growth of 5.1% in the first six months of 2015 but Sundermann said he was tired of competing with “illegal operators from abroad” who aren’t subject to the “over-regulation” inflicted upon state-licensed operators.

Germany currently has two competing online gambling regimes. Schleswig-Holstein allows a full palette of online gambling options while the other 15 German states operate under the much-loathed federal Interstate Gambling Treaty, which permits only online sports betting.

Last year’s botched issuance of 20 federal online sports betting licenses has come under intense criticism both at home and abroad. The opposition Green Party issued a statement this week criticizing the Hesse Interior Ministry’s arbitrary decision to cap the number of licenses at 20, a limitation that Greens home affairs minister Jürgen Frömmrich said was “never obvious” to him.

Last month, Hesse Interior Minister Peter Beuth wrote an op-ed calling for an “urgent” overhaul of the federal treaty. The Greens say they “support the efforts of the state government” to amend the treaty but other local parties have yet to join the fight. The Court of Justice for the European Union will issue an opinion on the legality of the state treaty on September 17, leaving Germany’s online gambling market mired in the status quo for another long hot summer.