Playtech renews Ontario deal with NorthStar and advances financing
Playtech has extended a strategic partnership between its Playtech Software Limited and the NorthStar Ontario subsidiary of NorthStar Gaming Holdings and agreed to advance CA$3.0m (£1.8m/€2.1m/US$2.2m) in short-term financing to the latter.
Signed in June last year, the strategic marketing agreement aims to accelerate the NorthStar player acquisition strategy in Ontario.
The initial agreement resulted in a total contribution of services from Playtech Software valued at $4.0m. This, NorthStar said, was a major driver of its growth in the Canadian province during 2023.
Under the extended deal, Playtech Software will now provide similar marketing services in Ontario. These are worth up to $4.0m and will run through to 31 October this year.
In reply, Playtech Software will be reimbursed and compensated through a share of revenue from income generated in connection with the marketing initiatives to which it contributes.
Financing boost for NorthStarÂ
Separately, NorthStar has issued a $3.0m unsecured, interest-bearing promissory note to Playtech. This will near interest of 8.0% per annum and is payable in arrears at maturity.
Proceeds from the note, NorthStar says, will help fund its ongoing growth strategy and for general corporate purposes.
“We are very pleased to continue to strengthen our relationship with Playtech, one of the world’s leading gambling technology companies,” NorthStar chair and CEO Michael Moskowitz said.
“Their ongoing support has been instrumental in helping us to acquire new customers, provide a premium online gaming experience, and fund the expansion of our brand in Ontario and across Canada.”
Playtech continues to back NorthStar
Playtech’s support of NorthStar stretches back further than the marketing agreement struck last June. A few months prior to this, Playtech agreed a $12.25m strategic investment in the Ontario-based online casino and sportsbook.
Alongside this, Playtech extended an existing software and services deal with NorthStar by 10 years. Playtech and NorthStar first entered the partnership in December 2021.
The investment is via a convertible debenture. This was then converted into equity and warrants in relation to NorthStar’s takeover of Baden Resources Inc. The deal completed in March 2023.
This left Playtech holding around 16% of the total issued and outstanding common shares belonging to NorthStar. It also holds warrants that giving it the right to boost its stake to over 20%.
In addition, off the back of the investment, Playtech’s chief financial officer Chris McGinnis joined the board of directors of the listed entity.
