How Aristocrat’s $990 million Big Fish deal will shake up social casino games

Billion-dollar game deals are pretty rare, but one slipped by last week without much attention. Australian gambling machine maker Aristocrat Leisureannounced last week it is buying social casino games maker Big Fish Games in Seattle for $990 million.

It was the second deal in a relatively short time for Big Fish. Churchill Downs, the owner of the Kentucky Derby, bought Big Fish Games in 2014 for $885 million. Aristocrat is clearly the latest company that believes that mixing gambling expertise (via its slot machines business) and non-gambling social casino games (where you can play virtual slot machines but can’t win real money) are a good fit.

Adam Krejcik, analyst at Eilers & Krejcik Gaming, issued a report today analyzing the deal. In the past 12 months, without the Big Fish results included, Aristocrat’s game divisions made an estimated $292 million in digital revenue in the period ended September 30, up 41 percent from a year earlier. In the third quarter ended September 30, Eilers & Krejcik estimated that Aristocrat generated $93 million in revenues in social casino games, up 63 percent from a year earlier.

Aristocrat, which has 5,000 employees and started making gambling machines in 1953, has been making big moves. In 2014, it bought Video Gaming Technologies for $1.3 billion to bolster its gambling machine business in North America. And it paid $500 million for Israeli mobile game publisher Plarium. Aristocrat will be behind only Playtika, which was acquired by Chinese game companies, in the social casino games business.

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