Better Collective has taken the decision to acquire the remaining 40% shares in RotoGrinders Network for a purchase price of €33 million, in a bid to strengthen its position in the US sports betting market.
To complete the transaction, the Copenhagen-based firm will pay €22 million in cash and the remainder in either shares or cash, with both components transferred no later than 31 December 2021 – this brings the total purchase price for 100% of RotoGrinders’ shares to €51 million when Better Collective’s initial 60% share acquisition is taken into consideration.
Both Better Collective and RotoGrinders shareholders initially had ‘mutual options’ to buy and sell the shares between 2022 and 2024, but instead decided to accelerate the purchase and complete it in one transaction before the close of 2021.
Explaining its rationale behind the takeover, Better Collective detailed that RotoGrinders ‘has seen significant growth’ within sports betting and daily fantasy sports (DFS) since it first acquired its majority stake in the company in May 2020.
Marc Pedersen, CEO of Better Collective US, remarked: “We are pleased to settle the full acquisition of the RotoGrinders Network earlier than originally planned. Since the initial acquisition, we have been impressed with the RotoGrinders team and we are excited to now welcome them to the broader Better Collective family and pursue all synergies to the fullest.
“Furthermore, we are pleased to keep the now previous shareholders in Rotogrinders engaged in Better Collective with the opportunity to benefit from their competences more widely in the organisation.”
A breakdown of the new acquisition’s operations demonstrated that the company’s revenue doubled from 2019 to 2021, with a 47% compound annual growth rate, in addition to experiencing a fourfold increase in revenue during the same time period at a 109% compound annual growth rate.
RotoGrinders sports betting operations are consolidated in its sportshandle.com and usbets.com platforms, and it conducts its DFS activities via RotoGrinders.com, and Better Collective anticipates these subsidiaries to ‘provide a strong platform for future growth’ as sports betting continues to roll out across the US.
The Nasdaq-listed sports betting media group also predicts synergies between its own subsidiaries and RotoGrinders’ aforementioned platforms, in addition to the latter’s Fantasy Labs, Action Network, vegasinsider.com and ScoresandOdds.com holdings.
“Joining Better Collective a few years back helped us fully unlock the potential of the RotoGrinders network,” said Cal Spears, CEO of Rotogrinders. “We’re proud to announce that our significant growth has led to an accelerated acquisition and that our team of 50+ will be fully integrated into Better Collective US going forward.
“All seven of the original RotoGrinders network shareholders and co-founders are now assuming full time or advisory roles. Better Collective is perfectly positioned for US growth and we’re excited to help realise its potential.”
The takeover is the second major M&A related development for Better Collective in recent months to focus on expanding the firm’s presence in the burgeoning US sports betting and fantasy sector, with the company disclosing a new management incentive plan related to its $250 million acquisition of US media subsidiary Action Network.