Meet the Newest Online Casino SPAC
Another day, another special purpose acquisition company (SPAC). dMY Technology Group Inc. (NYSE: DMYT) is bringing the online casino and sports wagering firm Rush Street Interactive public, joining the list of online gaming stocks. The two companies will be combining with the new company being called Rush Street Interactive trading under the symbol RSI.
The newly combined RSI is expected to have an initial enterprise value of roughly $1.78 billion, plus an estimated $235 million in net cash to fund its growth strategy. RSI’s projected 2021 revenue is anticipated to be $320 million.
RSI operates its U.S. online casino segment through BetRivers and SugarHouse brands, with a sports betting offering to roll out a new sportsbook app this year.
It’s worth noting that RSI’s majority shareholders, Neil Bluhm and Greg Carlin, will retain about 93% of their existing equity holdings in the combined company.
Cash proceeds from the transaction will consist of dMY’s $230 million of cash in trust and an additional $160 million PIPE investment led by Fidelity Management and Research at $10 per share in the common stock of dMY.
Any cash proceeds from the transaction remaining on the combined company’s balance sheet are expected to be used to accelerate RSI’s growth in both domestic and international markets, support marketing efforts and provide additional working capital.
Following the closing of the transaction, Bluhm will continue to serve as chair of the board of directors, Greg Carlin will continue to serve as chief executive and Richard Schwartz will continue to serve as president of the combined company.
In terms of the board of directors, dMY’s chair, Harry You, and CEO, Niccolo de Masi, will have seats. You is the former executive vice president of EMC and previously served as the chief financial officer of Accenture and Oracle, while de Masi is the current chair and former CEO of Glu Mobile, a leading developer and publisher of mobile games for smartphone and tablet devices.
dMY Tech stock traded up about 6% to $12.01 early Monday, in a 52-week range of $9.51 to $12.49.