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DoubleDown received $17-per-share takeover proposal from unidentified US buyer
The proposal exceeded the $16.25 per share DoubleDown ultimately agreed to accept. Financing and the position of its largest shareholder complicated the bid.
An unidentified US-listed company proposed buying South Korea-registered DoubleDown Interactive for as much as $17 per share, above the $16.25 per share the social casino developer and iGaming operator ultimately agreed to accept.
GamblingNews.com reported that the prospective buyer, identified in acquisition disclosures as Party A, first approached DoubleDown CFO Joseph Sigrist through an adviser on May 27. Discussions on 4 June described Party A as a strategic acquirer with a global presence and familiarity with DoubleDown and the gaming industry.
Party A said it could offer “meaningfully above” the $11.25 per-share proposal made by DoubleU Games at the time. On June 25, it submitted a written, non-binding offer of $15 per share, valuing DoubleDown’s equity at about $744 million.
The prospective buyer later raised its proposal to $17 per share. Party A disclosed that it had $41 million in cash but estimated it would need about $245 million in additional cash after accounting for DoubleDown’s existing net cash position.
Party A expected to raise around $600 million in debt financing to refinance existing borrowing and provide new loans. A financial adviser issued a “highly confident letter” on the financing arrangements, but questions remained about whether South Korean law would permit DoubleDown’s assets to help fund the purchase.
DoubleU Games was another factor in the negotiations. The company, DoubleDown’s largest shareholder, owned approximately 67% of DoubleDown and had little appetite to sell its stake, according to GamblingNews.com.