GiG is nearing the finalization of its acquisition of an 80% stake in 888Africa, marking a notable repositioning for the group into the B2C sector. Phil Richards, the group's CFO, is optimistic about this move, seeing it as a means to quickly boost earnings and establish a firm presence in Africa's burgeoning markets.
Last month, GiG Software plc revealed plans to acquire the 80% stake in Evoke's 888Africa, valued at up to €16.4 million ($19.1 million). To finance this acquisition, GiG plans to raise €2.5 million through a directed share issuance and an additional €6 million via convertible debt. This deal represents GiG's return to the B2C arena after it transitioned to a pure B2B model earlier in 2023.
Richards stated that the transaction is expected to conclude by the end of September, providing GiG with a “profitable, cash-generative B2C operator” and a foothold in some of Africa's rapidly expanding regulated markets. He noted that this acquisition serves as a strategic foundation for GiG's core B2B operations, emphasizing the dual advantages of the deal.
“The dual value is really the point of the deal,” Richards explained. “Owning a leading local operator gives us direct, ground-level insight into regulatory developments, player behavior, and payment infrastructure across several African markets, insights that are hard to obtain from a distance.” He added that this local knowledge is expected to facilitate discussions with other operators aiming to enter the African market, similar to the way GiG's past B2C experience in Europe bolstered its platform proposition.
The decision to re-enter the B2C space has raised questions, especially after GiG had previously exited this sector. Richards cautions against viewing this move as a blanket return to B2C, insisting that GiG remains fundamentally a B2B tech company.
Richards attributes the return to B2C to three key factors. First, GiG's priorities have shifted towards a disciplined focus on profitability and cash generation, with 888Africa being immediately beneficial on both fronts. Second, the opportunity for acquisition was time-sensitive; 888Africa became available due to Evoke’s strategic shifts, a rare chance for such a quality asset. Third, the African market has matured, showing genuine growth driven by regulatory, mobile, and demographic trends.
Compounding these views, analyst Hjalmar Ahlberg from Redeye hinted that GiG’s move into 888Africa may be influenced by challenges in its B2B segment. Initial projections seemed promising, but there were uncertainties, particularly with clients such as sweepstakes operators and a tier-one customer in Brazil that opted out.
Although GiG faces B2B headwinds, Ahlberg sees the 888Africa deal as an opportunistic move. Richards further described the acquisition as “targeted, opportunistic” with appealing financials. As part of the ongoing acquisition of Evoke, Bally's Intralot will maintain a 20% stake in 888Africa and continue management.
Robinson of Corfai Capital noted the €16.4 million valuation as attractive based on GiG’s disclosed numbers, calling it a compelling figure for a growing business. There’s a deferred component of €10.4 million, which reduces the immediate financial burden for GiG. Richards pointed out that interest in Africa has been present for some time, with GiG receiving relevant information as early as Q2 2026.
888Africa is not perceived as a turnaround story. Under the leadership of Christopher Coyne, the company already holds significant market share in vibrant markets like Mozambique, Angola, and Tanzania. Richards highlighted that they are purchasing a venture with established local presence, which mitigates risks typically associated with entering consumer markets from scratch.
However, Robinson cautioned that while Africa presents opportunities, it is not without challenges. He remarked that while the market is profitable and growing, it is also competitive, with entrenched players such as Betway. The key difference lies in entering a developing market at a lower acquisition cost compared to saturated European markets.
In terms of strategy following the acquisition, Richards emphasized disciplined integration as a priority, aligning 888Africa’s financial, compliance, and operational processes with GiG's standards. The transition of 888Africa onto GiG’s platform is also anticipated, aiming for synergies in the future. However, he stressed that the initial focus will not include aggressive expansion but rather integration and consolidation of existing positions.
While some analysts speculate that this acquisition could signal further B2C moves by GiG, Richards clarified that this is a unique situation related to Africa’s potential. He noted financial constraints would limit immediate opportunities for additional B2C acquisitions.
In contrast, Robinson perceives this acquisition as potentially indicating a broader shift in GiG’s strategy toward emerging markets. He argues consolidating in these markets could become critical for GiG's ongoing independence. Ahlberg sees the acquisition as opening pathways for GiG, establishing a balance between its B2B and B2C engagements based on performance outcomes from both sectors.
