GAN Going with NASDAQ Listing Before April End, Looking to Raise $35 million

Posted on: April 13, 2020, 03:00h. 

Last updated on: April 13, 2020, 11:28h.

Todd Shriber @etfgodfather Read More

Expertise: Financial, Gaming Business, Mergers and Acquisitions.

GAN, the gaming technology company formerly known as Game Account Network, is forging ahead with plans to list its shares on the NASDAQ stock exchange. It hopes to raise $35 million in the process in an offering that could happen before the end of this month.

The company’s stock currently trades on the Alternative Investment Market (AIM) in London – an exchange reserved for smaller, emerging companies – and over-the-counter in the US under the ticker “GMMNF.” It’s expected the stock’s new US tag will be “GAN.”

GAN believes a US listing will provide easier access to capital should the company need it and potentially boost analyst coverage the stock, among other benefits.

We believe that a NASDAQ listing will create a number of favorable results for GAN shareholders, including, but not limited to: ease of share purchasing on a U.S. exchange for U.S. investors; increased liquidity (number and value of shares bought/sold every day); increased access to cheaper capital (should we even need more capital, in the future); additional research coverage by US banks (whereas we only have two research analysts covering our shares in the UK); and enhanced reporting standards (quarterly reporting versus semi-annual),” according to a statement issued by the company.

Citing the liquidity benefits afforded by trading on NASDAQ and the complexities associated with dual listings in two countries, GAN said it plans to scuttle its London-traded shares.

Looking For Growth

The majority of GAN’s revenue is derived from US clients, many of which are land-based casinos or purveyors of online gaming technologies. The company is also an increasingly prominent player in the fast-growing US sports betting market, making a New York stock offering a sensible idea.

GAN has seen a meaningful increase in the addressable US market opportunity as a result of internet sports betting starting in 2018, following a favorable judgment by the U.S. Supreme Court,” according to the company. “Last year, in 2019, more than 80% of our total revenue originated in the U.S. with the balance from Europe.”

Last month, it was revealed that GAN CEO Dermot Smurfit Jr. and his father are loaning the company nearly $2.5 million to speed the NASDAQ offering along. Soon after, it was reported that the CEO scooped up $32.36 million worth of the software company’s stock.

Could Lure Investors

GAN investors approved the NASDAQ listing on March 31.

“The Company expects to list on the NASDAQ within 30 days of the shareholder meeting completed on March 31, 2020,” said the company. “Directionally, this overall process should be completed before the end of April 2020, subject to market conditions.”

At a time when some analysts and investors are fretting about the cash positions and obligations of traditional casino operators, GAN could be appealing on Wall Street because it carries no debt and had $10 million in cash at the end of last year.

“The capital raise is intended to establish a broader investor base to enhance trading liquidity,” according to the company. “The additional capital will also further enhance GAN’s capital resources, enabling the Company to scale and rapidly capitalize on growth opportunities.”