Inspired Gaming sold to acquisition vehicle led by ex-Sci-Games CEO for £200m

inspired-gaming-sold-virtual-sports-bettingNasdaq-listed virtual sports betting technology supplier Inspired Gaming Group has been sold to a newly formed acquisition vehicle for £200m.

On Thursday, New York-based Hydra Industries announced it had convinced Inspired’s hedge fund owners Vitruvian Partners to sell the company. It’s the second major shedding of gaming operations by Vitruvian this year, following the April sale of betting tech outfit OpenBet to NYX Gaming Group for £270m.

Hydra will pay Vitruvian around $100m in cash upfront, with the remainder payable in Hydra shares, giving Vitruvian a 35% stake in Inspired. Vitruvian could receive additional shares if Inspired hits future performance benchmarks. The deal is expected to close in October, after which Inspired will be rechristened Inspired Entertainment.

Hydra is led by Lorne Weill, the former CEO of gaming technology supplier Scientific Games Corp. Weill will become Inspired’s new executive chairman while Inspired founder and CEO Luke Alvarez will continue in his current role while also getting a seat on the new Inspired’s board of directors.

Vitruvian acquired Inspired back in 2010 for £75m, so not a bad return on its investment. Inspired expects it will generate estimated revenue and earnings of $110m and $38m, respectively, in its most recent fiscal year ending September 2016.

Weill said Hydra had been “searching for a compelling business that utilizes our skill set to drive growth.” In addition to growing Inspired’s business, Weill said Hydra would use Inspired “as a platform for potential opportunistic acquisitions of synergistic businesses across a number of geographies.”

Alvarez said he looked forward to partnering with Hydra while maintaining a “strong relationship” with Inspired’s former majority owners. Vitruvian partner Philip Russmeyer logrolled back, saying the hedge fund had enjoyed a productive partnership with Inspired management.