Pretty soon, the world will start on its global path of recovery following the coronavirus pandemic. There are already certain areas, like Macau and China, that are picking up the pieces, but others are being forced to wait a little longer as the virus refuses to relinquish its grip. During this forced hiatus, the gaming industry has been hit especially hard, with land-based casinos and sportsbooks finding their revenues in a freefall with no parachute and no reserve. However, the online gaming segment has been able to face the challenges a little better, and some online operators have seen an uptick in their activity, and this could prove to be extremely beneficial to a particular online gaming software company next month. U.K.-based GAN Ltd. has announced that it is moving forward with its plans to offer an initial public offering (IPO) on a U.S.-based exchange.
GAN had hoped to have all the pieces of the puzzle in place for a public offering before the end of this month, but has pushed back its timeframe slightly. It now hopes to launch publicly the first week of May, possibly targeting a spot on the NASDAQ exchange using, of course, the ticker GAN. If everything goes well, the company hopes its IPO generates as much as $34.5 million.
Under most circumstances, looking to attract that much investment money may seem a little unrealistic as investors have tightened their belt while facing the coronavirus pandemic. The gaming industry as a whole has seen its average stock price plummet by more than 70%. However, there are a couple of factors GAN has working for it: online gaming hasn’t suffered nearly as much as other segments and the post-COVID-19 world is going to see a greater push for more legalized gaming and sports gambling.
This is going to be especially true in the U.S., where sports gambling had begun to receive a lot of support in the past two years. Additionally, a growing number of states have started discussing the possible of either introducing or expanding gambling operations as they see the potential for revenue, and these conversations will only be sped up because of the coronavirus.
Last year, GAN earned around 80% of its business from clients in the U.S., making a launch on a U.S.-based exchange a smart business move. The IPO will take place just as an expected recovery process for casinos and sportsbooks begins, and the company will be in a great position to capitalize on a number of new projects that are going to come.
GAN has been working on a number of new deals already and recently partnered up with the Sault Tribe in Michigan to provide sports gambling software for the tribe’s operations. That’s just one of many for the company, with a virtually unlimited supply of additional partnerships waiting in the wings. Once the recovery gets fully active, an all-out blitz on all types of gambling should be expected, opening up new doors for the entire industry.
The company hopes to list its shares, of which it has 4.05 million ready to offer, at anywhere from $6.50 to $8.50 apiece. It may be taking its cue from DraftKings, which just went public at the end of last week. It started at $9.76 and, just a few days later, is already trading at $19.89 and rising.