Scientific Games (NASDAQ:SGMS) inked a deal on Thursday to buy WMS Industries (NYSE:WMS) for $1.5 billion in cash and debt as it looks to expand its portfolio of lottery and gaming products.
The $26-a-share deal, which represents a premium of 59% over WMS’ closing price of $16.37 on Wednesday, combines two leading suppliers of products and services to public and private sector lottery and gaming customers.
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New York-based Scientific, whose shares climbed nearly 20% on the announcement, makes lottery instant tickets, lottery and video gaming systems, while WMS, based in Waukegan, Ill., supplies gaming machines and interactive gaming content.
"We expect to combine our game content, technology, operational capabilities and respective geographic footprints to create an enterprise poised to capitalize on significant growth opportunities around the globe,” said Scientific CEO A. Lorne Weil.
The transaction is expected to help diversify Scientific's portfolio while expanding margins through efficiencies as it grows its size and scope.
Shares of WMS climbed nearly 53% to a 52-week high of $25.34 on the news.