The global poker machine company, Aristocrat Leisure Limited, has resurfaced in the gambling news after revealing plans to launch an online casino before the end of the year. This new venture will target the emerging US iGaming market.
At the company’s Annual General Meeting, Trevor Croker, Group Chief Executive Officer, and Managing Director spoke about the company’s new direction. He approved the plan to make Mitchell Bowen, the former CEO of Aristocrat, the head of the newly launched online business section. Aristocrat’s land-based gaming business will also be led by Hector Fernandez, the former head of the company’s Americas division.
Aristocrat executives also announced a $500 million on-market share buyback. The company will return a significant portion of the $1.3 billion collected in its 2021 Playtech takeover plan under the plan.
Aristocrat Plan Comes on the Heels of the Playtech Rejection
The announcement of the new business segment comes just five months after Playtech shareholders rejected Aristocrat’s $2.8 billion takeover bid. According to gaming industry experts, the hiccup was the primary motivator behind the recent announcement to add an online gaming segment.
Gavin Harper of True Blue Casino explained the move in an interview as a strategy to seize control of the gambling industry. “Aristocrat is a strategic company determined to control the gaming world despite challenges,” Harper said. “We can expect the company to be a major determinant of what happens in online gaming in a few years.”
The new business direction will see the company fulfill its desire to create online gambling software for casinos and other related businesses. Trevor Crocker reports that the company already has two US clients in two different states. Providing what they desire will mark the beginning of Aristocrat’s success in the new business venture.
What does this mean for Aristocrat?
The introduction of online real money gaming will allow the company to expand beyond its current business boundaries. The new RMG-focused business stream will join Pixel United, Aristocrat Gaming, Big Fish Games, Plarium, and Product Madness in the company’s corporate structure.
Aristocrat will create a new business channel to capitalize on the current wave of iGaming legalization. The company already sells slot machines and smartphones with slot games. It already has a strong customer base in the poker machine segment, indicating that it is well-positioned for future growth.
However, the company currently appears to be focused on gaining a larger share of the gaming industry.
According to Crocker, the company is looking into other ways to increase revenues, such as direct-to-customer products. He believes that the company can capitalize on the various opportunities for serving the numerous verticals that are available for exploitation. He believes it is necessary to take advantage of the opportunities, including casino gambling if the government regulations allow it.
The Build and Buy Strategy
The expansion will force Aristocrat to change its strategy in almost every aspect of the business. Most notably, it will necessitate an increase in Aristocrat’s investment in its online real money gaming.
“It is necessary for Aristocrat to invest heavily on its own RMG platform infrastructure while also selecting compatible mergers and acquisitions to accelerate its success in the new venture,” Gavin Harper said.
Aristocrat appears to be on the right track. Crocker stated that Aristocrat has been taking deliberate steps to reach the required potential levels. The company has been investing continuously in developing internal online real-money gaming capabilities, which will now propel the company towards its goals.
However, the company’s efforts must be maintained and increased in the future to sustain the exponential growth. The CEO of the company explained the company’s plans to invest in talent acquisition in order to accelerate progress in all areas. The company is establishing a third global business within itself in order to achieve the necessary level of focus and momentum to successfully complete the objectives ahead.
Aristocrat intends to scale to the desired levels in the new venture over the medium term. The company will put in the necessary effort over a number of years to achieve the global dominance it desires in the gaming industry. Already, Aristocrat has demonstrated the ability to scale ventures to optimal levels within the time frame.
The company intends to use a combination of various proven operational and financial efforts in its new venture.
Fortunately, it has the necessary leadership and stakeholder support to achieve the desired levels of success moving forward. Mitchell Bowen has a well-deserved reputation in the gaming industry for producing outstanding results. Aristocrat’s new venture is expected to be transformative under his leadership.