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Betmakers Technology Group Ltd (BET.AX) To Power New Wagering Venture

·7-min read
Betmakers Technology Group Ltd
Betmakers Technology Group Ltd

Betmakers Technology Group Ltd (BET.AX) To Power New Wagering Venture

Sydney, Australia, April 21, 2022 - (ABN Newswire) - The Board of BetMakers Technology Group Ltd (ASX:BET) (OTCMKTS:TPBTF) is pleased to announce that a wholly owned subsidiary of the Company, OM Apps Pty Ltd ("BetMakers"), has entered into an exclusive 10 year agreement ("Agreement") with NTD Pty Limited ("NTD"), a new wagering venture which has been formed by the Consortium. Under the Agreement, BetMakers will provide technology and services to the new wagering venture.

Highlights

- BetMakers selected as the exclusive technology and services provider in Australia and New Zealand to new wagering venture

- Full services contract including platform technology and Managed Trading Services

- 10-year contract with revenue share arrangement and potential revenues greater than $300m

- The new wagering venture is a consortium comprised of Tekkorp Capital LLC (Matt Davey), News Corp Australia, and TGW, a trust whose investors include Matt Tripp (the "Consortium")

- Matt Davey stepping down from the BetMakers Board however remains a long-term shareholder of the Company

Highly Strategic and Attractive Partnership for BetMakers

Under the terms of the Agreement, BetMakers will provide platform technology ("B2B Platform") and wagering solutions to the new wagering venture and is expected to receive multiple revenue streams over the life of the 10 year contract.

The terms, detailed below, include the potential to earn revenue of more than $300m , with minimum revenues for BetMakers of ~$80 million, over the initial 10-year contract period.

The Company's Chief Executive Officer, Todd Buckingham, said:

"We are excited to partner with the Consortium to enter this space under our proven business model.

"We feel this partnership cements the Company as a leading provider of B2B platforms and software to the wagering industry.

"This deal will allow the Company to demonstrate that we are a viable pathway for large scale operators that want to enter markets quickly and efficiently, allowing them to focus their resources into marketing strategies.

"While this deal is focused on the Australian market, we feel this model will play an important part of our international expansion."

Key financial terms include:

- Platform Establishment Fee of $2 million and a Launch Development Fee of $500,000 per month between signing and the go live date. BET management expects the go-live date will occur within six months;

- Development & Service Fee of a minimum $7.5 million per annum commencing on the go-live date and increasing by CPI on each anniversary of the go-live date, representing a minimum base fee of $75 million over the 10-year contract (before CPI increases);

- Annual Fee based on a revenue sharing arrangement starting at 25% of ongoing net gaming revenue, reducing by 1% on each anniversary of the go live date during the 10-year contract as the business scales, less the annual Development & Service Fee;

- Annual Fee is subject to a maximum cap of $20 million per annum initially, growing at +10% per annum for 8 years following the go live date and +5% per annum thereafter to $43 million at the end of the 10-year period. This equates to a total maximum revenue possible over 10 years after the go live date of ~$313 million, plus the Launch Development and Platform Establishment Fees.

The material terms of the Agreement are set out in Annexure A to this announcement.

Performance Rights Vesting to Tripp

Under the Strategic Advisory Agreement, an entity associated with Mr Tripp ("Tripp") was issued 35 million Class A Performance Rights which vest upon delivery of a 'Strategic Deal'.

After an independent expert evaluated the Agreement as satisfying the criteria for a 'Strategic Deal', the 35 million Class A Performance Rights have vested. Tripp has agreed to increase the escrow arrangement to 100% on the Class A Performance Rights (and any shares issued on conversion) for a period of 3 years in return for consideration of $15 million.

Mr Tripp will continue to be engaged with the Company exclusively advising on B2B opportunities.

Mr Matt Davey stepping down from the Board

As a result of the time commitments of the new venture, and other international ventures, Matt Davey will be stepping down from the Company's Board of Directors, effective today.

The recent appointments of two new Independent Non-Executive Directors, Anna Massion and Rebekah Giles have further strengthened the Board, allowing Mr Davey to focus on his other activities. He remains a committed long-term Company shareholder.

Matt Davey said:

"The Company has come a long way in a very short space of time and I'm excited to be handing over the reins to a very competent Board that will now drive the company into the next phase of growth.

"As the largest shareholder in the Company, I remain a committed shareholder that believes in the vision and direction of the Company and hold great confidence the team is in place to execute on this strategy."

The Company's Chief Executive Officer, Todd Buckingham, said:

"We are delighted to have entered into this landmark Agreement to be the B2B supplier of wagering technology to a Consortium with such high calibre investors, including a global media giant and two experts in wagering, Matt Tripp and Matt Davey.

"BetMakers is thrilled to be chosen as the new venture's technology supplier, which is a testament to the B2B technology and business model that the Company has built. We believe it validates our strategy and supports our view that the end-to-end B2B solution the Company provides is an efficient and commercially viable way to successfully launch a wagering platform in today's global wagering markets."

Matt Tripp, said:

"I am delighted to be a part of delivering a material agreement for the Company, a company that I have been significantly involved with as a strategic advisor and shareholder. I have seen first-hand the technology and solutions that BetMakers has developed and implemented, with the Company continuing to set new global benchmarks in delivery for wagering operators and racing bodies around the world. BetMakers provides one of the best end-to-end packages of technology and trading services in the global B2B wagering market, which is why I am happy to invest in a new wagering venture that will rely upon it."

Matt Davey, said:

"The new wagering venture is a significant investment by Tekkorp Capital and one that I am very excited about. As a result of announcing this deal and combined with other opportunities opening up in the U.S. and globally, I am resigning from my position as a Non Executive Director of the Company.

"As the largest shareholder of the Company, I have been suitably impressed during my time on the Board not only by the Company's corporate structure, governance and strategy but in particular the ability of management to execute on the enormous opportunity in front of it. I am very excited by its future and intend to remain a supportive long-term shareholder. The recent appointments of two new highly respected Independent Non-Executive Directors, Anna Massion, who I have known through dealings in the U.S., and Rebekah Giles in Australia, adds great strength to the Company's foundation Board members, including Chairman Nick Chan, and places it in excellent shape to oversee the implementation of an exciting next phase of growth by BetMakers' management."

About the new wagering venture

The new wagering venture will apply for a sports bookmaker licence under which it will operate a new online wagering product for Australian and New Zealand punters to bet on racing and sports.

The product launch is scheduled for the second half of 2022 and will seek to add new products and experiences for Australian and New Zealand customers that will grow the overall market.


About Betmakers Technology Group Ltd:


Betmakers Technology Group Ltd (ASX:BET)(OTCMKTS:TPBTF) is an ASX-listed holding company and a global provider of online wagering products and services to both wholesale and retail markets through its various wholly owned subsidiaries. The Company operates a retail wagering business, offering consumers wagering, fantasy tournament and content products and services.

Contact:

Charly Duffy
Company Secretary
E: companysecretary@thebetmakers.com
M: + 61-409-083-780

Jane Morgan
Investor and Media Relations
E: investors@thebetmakers.com
M: +61-405-555-618

Source:
Betmakers Technology Group Ltd

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