Nazara Technologies Limited has entered late-stage discussions to acquire several real money gaming firms in Africa and India ahead of a public market entry in February 2019.
The Mumbai-based social gaming and esports company has reportedly set aside between $7m and $10m to invest in options, including daily fantasy sports properties, as part of a bid to achieve $135m as India’s first publicly listed gaming firm.
Following the acquisition of esports gaming platform Nodwin Gaming and the Halaplay DFS portal in June, Nazara entered the african market through a 70 percent purchase of sports betting operator NZWorld Kenya Ltd.
Backed by investment institutions WestBridge Capital and Rakesh Jhunjhunwala IIFL, Nazara is now seeking to enhance its African portfolio through discussions with four gaming firms on the continent, aiming to secure acquisition approval before October of this year.
The expansion is driven by a flourishing Indian online gaming market, currently valued at just under $600m and expected to grow at an annual compounded rate of 22 percent to reach $1.6bn by 2023.
The figures come as Indian courts recently defined fantasy sports as a skill activity, with the Punjab and Haryana High Court ruling in April that DFS required “considerable skill, judgement and discretion,” and is therefore not governed by the country’s strict 1867 Public Gambling Act.
The newly lenient approach to DFS in India has driven player figures up from ten million in 2016 to over 40 million this year, precipitating the launch of India’s first and only self-regulatory Sports Gaming industry body, IFSG, in 2017.
The African gaming industry is also benefiting from advances in regulation to reflect an increasingly mature market, which senior manager for PwC South Africa Sanchia Temkin predicts will enhance the “dynamic” market of South Africa and Nigeria, while “growth will remain relatively stable” for Kenyan operators.
With both African and Indian markets demonstrating significant potential, Nazara’s expansion may prove a profitable proposition for investors, adding to the firm’s considerable portfolio, already present in 61 countries, which includes Mastermind Sports, Crossgate Solutions and Moong Labs.
The firm’s public offering will be overseen by Indian capital market company ICICI Securities, as well as Mumbai-based Edelweiss Financial Services, and will promote Nazara’s 2017 revenue of $75m as a key investor enticement.