Last week, provider of sports betting technology and services Kambi Group plc made headlines when it announced the acquisition of Shape Games, an award-winning front end technology specialist for an upfront consideration of €38.5 million.
Commenting on the deal, Kambi co-founder and CEO Kristian Nylen said:
“I’ve always been clear on our intention to acquire technology and talent that will complement and enhance our sportsbook proposition, and I have no doubt Shape Games will do just that.
“Having worked closely with Shape Games and its experienced team over recent years, I have seen first-hand how their technology enables operators to extract the full value of the Kambi sportsbook and provides the level of control operators require to deliver bespoke experiences to their players.
“While Shape Games will continue to grow and offer services on a standalone basis in line with our plans to offer a suite of modularised products, it is the ability to offer a combination of Kambi’s and Shape Games’ technology to our partners which really excites us and solidifies our position as the clear leader within the sports betting ecosystem.”
The acquisition also includes a performance-related earnout of up to €39.6 million, potentially bringing the total consideration to €78.1 million, all to be paid in cash.
Headquartered in Copenhagen, Denmark, Shape Games is described as an industry leading front end provider, focused on driving customer engagement and retention through the delivery of its customisable, fully native frontend technology to leading operators in regulated markets. Shape Games’ growing roster of partners includes Danske Spil and Norsk Tipping, as well as Kambi partners BetWarrior and JACK Entertainment, with each operator leveraging Shape Games’ technology to offer highly differentiated user experiences.
Transaction highlights and strategic rationale
Shape Games’ fully native front end technology complements Kambi’s high performance sportsbook and existing front end capabilities, creating a compelling proposition that will significantly enhance Kambi’s capabilities in the mobile space where the vast majority of sportsbook turnover originates, the companies said in a statement.
Combined, Kambi and Shape Games “will empower operators to deliver exciting, tailored sports betting experiences to their players like never before.”
The sportsbook front end has become a key tool for operators to effectively differentiate their brand, localise their offering and engage players to increase acquisition and retention.
The acquisition builds upon an established partnership between the two companies. Kambi and Shape Games have successfully combined on tender processes to secure turnkey contracts and Kambi believes the closer bond this agreement delivers will ultimately lead to greater commercial success for both parties.
As such, Shape Games will continue to provide its services on a standalone basis to all operators, but a closer technical and commercial integration with Kambi will enable an enhanced service to be offered to the latter’s current and future partners. In 2021, Shape Games generated revenue of €7.6 million at an EBITDA of €2.8 million, with 2022 forecast to deliver 100 per cent year-on-year growth following several major partner wins.
Christian Risom, Shape Games CEO and co-founder, said: “We are very happy to join forces with the leading sportsbook provider of the industry. Shape Games and Kambi have been working closely side by side for years now and it is exciting to take this partnership to new levels. Together we will have an unmatched sports betting and casino offering for any market in the world, be it on mobile and web or in retail.
“Kambi’s modular approach to the market allows us to form a profound and tight-knit integration with their sportsbook all the while pursuing opportunities with other sportsbook partners. From our perspective, this represents the best of both worlds for any customer out there. For me personally, the years we have worked with Kambi were a clear testament to the cultural match between the two organisations as both have a deeply rooted focus on best-in-class technology, customer experience and integrity in everything we do. It has always been great working alongside Kambi as collaborators and I am certain that what lies ahead is even greater.”
Shape Games was founded in 2018 by Risom, chief product officer Nicolas Linde, and chief technology officers Ole Gammelgaard and Philip Bruce, all of whom will continue to lead the company post-acquisition. Shape Games applies the vast front end experience gained from working with companies such as RedBull, Bang & Olufsen and Credit Suisse to the iGaming industry. Shape Games has since won numerous industry awards and several high-profile clients across Europe, North America, and South America. The company has approximately 80 employees, with offices in Denmark, Spain, the Isle of Man, and Latvia.
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Completion of the deal is expected in the coming weeks