Super Group Draws Praise Ahead of SPAC Deal Closing
Sports Entertainment Acquisition Corp. (NYSE:SEAH), the special purpose acquisition company (SPAC) meeting with Betway parent Super Group, is earning kudos from a sell-side. That indicates there’s some enthusiasm for what’s likely to be 1 of the fourth quarter’s largest blank-check deals.
In a observe to clients today, Benchmark psychoanalyst Mike Hickey starts reporting of Sports Entertainment Acquisition with a “buy” rating and a $16 price target, implying upside of 45.45 percent from the Nov. 29 close. That reporting testament transferee to Super Group when it becomes a standalone public entity. The blank-check dealings is slated to closelipped in the electric current canton and the gaming operator testament swop on the New House of York Stock Exchange under the stock ticker “SGHC.”
The psychoanalyst forecasts on-going ontogeny for the global online gaming market, noting Super Group’s “highly profitable” internet program and pragmatical attack to gaining share inward new markets present it “a winning expression for ongoing success.”
When the blank-check transaction was announced inwards April, the Betway parent said the trade had a pre-equity valuation of $4.75 billion. That indicates Super Group’s merger with Sports Entertainment represents 1 of the largest combinations to date 'tween a SPAC and a gaming company.
Reasons to Believe Hickey Is Right
With shares of so many deSPACed companies faltering, including several inward the gaming industry, analysts and investors are increasing scrutiny on equilibrise sheets and financial sturdiness.
While Super Group is coming to marketplace at a time of waning enthusiasm for gaming SPAC deals, in that location are reasons to believe Hickey’s bullish assessment is warranted. As noted above, the company is profitable — a rarity among online sportsbook operators.
Super Group calculate $1.5 one thousand million of sack gaming revenue (NGR) this year, with earnings before interest, taxes, wear and tear and amortization (EBITDA) of $350 million. Those figures are expected to puff up to $1.7 one million million and $420 million, respectively, next year.
Following the gag rule of the deal with Sports Entertainment, Super Group testament feature $200 meg in hard currency on its equilibrate bed sheet and no debt.
Inside Super Group Thesis
For investors, a possible source of allure with Super Group is that the troupe isn’t aiming to scale Betway to FanDuel or DraftKings levels in the US. That implies it doesn’t need to enlist inwards a cash-sapping spending war simply to gain ground marketplace share.
Still, the manipulator has US growing plans. When the blank-check dealing was announced, Super Group also said it’s getting Digital Gaming Corp. (DGC). The purchase of DGC brings added marketplace get at of up to 10 states, including Colorado, Indiana, Iowa, New Jersey, and Pennsylvania, and that could be applicable to both iGaming and sports wagering, according to the company.
Malta-based Betway has to a greater extent than 60 firebrand agreements with athletes, leagues, and teams around the world. In the US, such accords include the NBA’s Brooklyn Nets, Windy City Bulls, Golden State Warriors, and the Los Angeles Clippers.
It’s non instantly crystalise when Super Group will make believe its NYSE debut. But the finally month of 2021 could live occupy for gaming SPAC deals closing. Codere Online, a Latin American iGaming and sports wagering firm, debuts on the Nasdaq tomorrow, and Tilman Fertitta’s Fertitta Entertainment is expected to complete a merger with FAST Acquisition (NYSE:FST) inward the electric current quarter.
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