Q&A: NetEnt on its path to success in the US and the Evolution Gaming merger
CEO Therese Hillman on the return to growth and how Red Tiger set the company on the road to its takeover by Evolution Gaming
EGR Intel: A lot of positive results during the second quarter, what for you is the standout area of growth and why?Therese Hillman (TH):EGR Intel: What for you has been the secret to NetEnt’s success in the New Jersey and Pennsylvania markets and how do you plan to roll that out into other states?TH:EGR Intel: Do you believe the shift online in the US will continue in the post-Covid-19 environment?TH:EGR Intel: At what stage is your proposed expansion of the Red Tiger brand into the US?TH:EGR Intel: Do you plan to expand your operational capabilities as a result? If yes, in what areas?TH:
EGR Intel: Will the potential takeover of the business by Evolution Gaming help or hinder the progress of the Red Tiger migration?TH:
When we acquired Red Tiger, we wanted them to deliver and continue to do so and I think Evolution will have the same mindsetÂ
EGR Intel: In what ways has the integration with Red Tiger transformed NetEnt into a more productive and faster-paced company than it had done previously?
TH: I would say that we have come closer within the company and that we’re working as a faster and smaller company compared to how we used to. From a business perspective we are less siloed and, as result of integrating the Red Tiger business, our commercial teams can deliver both NetEnt and Red Tiger products far quicker to our customers following the integration. So, I would say that we are running faster and that we see it’s needed. It’s always good to have a benchmark of how good you can be and how fast you should be. Absolutely. I mean, it gives you something to aim for. And obviously, once the benchmark is achieved, you’ve got that positive reinforcement that you’re doing the right thing as a business.
EGR Intel: What are the significant synergies that will result from the Evolution Gaming takeover?
TH: The position of the company as a combined group, together with the cross-selling opportunities in our different markets, would be obvious ones. If you have a great product across the board – you have a very strong live product, strong slots, strong table games – if you have the full offering then you have a very good chance of becoming the best partner of gambling operators. Those are the given ones and also the innovation that comes out of combining three brands into one group is pretty exciting. There will be a lot of talent there going forward.
EGR Intel: Do you think the positive integration and benefits from the Red Tiger brand being brought into NetEnt accelerated the potential takeover of the business by Evolution Gaming?
TH: From a financial perspective it’s clear that we have returned to organic growth again. We have higher margins and with the acquisition of Red Tiger we occupy a different position in the market so from that perspective we are more attractive. However, it’s also about the journey that we’ve been on for the last two years, which has made us more attractive because we’ve taken a lot of actions in order to transform the company. When we bought Red Tiger, we saw that there is a larger business opportunity in working together and I think Evolution Gaming is seeing that now clearly as well.
EGR Intel: If the Evolution Gaming deal goes through, are there business concerns over trying to do too much at one time?
TH:Â I think this is primarily a question for Evolution Gaming. Our focus is to deliver on our long-term plans and we have a joint plan for NetEnt and Red Tiger which focuses on hitting our numbers, something which I think is in the best interests of all parties concerned. Coming back to when we acquired Red Tiger, we wanted them to deliver and continue to do so and I think Evolution will have the same mindset, no one wants to mess anything up.
EGR Intel: Will the potential takeover of the business by Evolution Gaming help or hinder the progress of the Red Tiger migration?
TH: It’s a difficult one to answer, the migration of Red Tiger is in line with our plans and all the improvements that we’re making to the business so it’s natural that Evolution as prospective owners will want to continue that and not hinder it.
ll want to continue that and not hinder it.
What we need to do is roll out with more operators in Spain and places like Italy and then start to deliver localised content for that market
When we acquired Red Tiger, we wanted them to deliver and continue to do so and I think Evolution will have the same mindsetÂ
EGR Intel: In what ways has the integration with Red Tiger transformed NetEnt into a more productive and faster-paced company than it had done previously?
TH: I would say that we have come closer within the company and that we’re working as a faster and smaller company compared to how we used to. From a business perspective we are less siloed and, as result of integrating the Red Tiger business, our commercial teams can deliver both NetEnt and Red Tiger products far quicker to our customers following the integration. So, I would say that we are running faster and that we see it’s needed. It’s always good to have a benchmark of how good you can be and how fast you should be. Absolutely. I mean, it gives you something to aim for. And obviously, once the benchmark is achieved, you’ve got that positive reinforcement that you’re doing the right thing as a business.
EGR Intel: What are the significant synergies that will result from the Evolution Gaming takeover?
TH: The position of the company as a combined group, together with the cross-selling opportunities in our different markets, would be obvious ones. If you have a great product across the board – you have a very strong live product, strong slots, strong table games – if you have the full offering then you have a very good chance of becoming the best partner of gambling operators. Those are the given ones and also the innovation that comes out of combining three brands into one group is pretty exciting. There will be a lot of talent there going forward.
EGR Intel: Do you think the positive integration and benefits from the Red Tiger brand being brought into NetEnt accelerated the potential takeover of the business by Evolution Gaming?
TH: From a financial perspective it’s clear that we have returned to organic growth again. We have higher margins and with the acquisition of Red Tiger we occupy a different position in the market so from that perspective we are more attractive. However, it’s also about the journey that we’ve been on for the last two years, which has made us more attractive because we’ve taken a lot of actions in order to transform the company. When we bought Red Tiger, we saw that there is a larger business opportunity in working together and I think Evolution Gaming is seeing that now clearly as well.
EGR Intel: If the Evolution Gaming deal goes through, are there business concerns over trying to do too much at one time?
TH:Â I think this is primarily a question for Evolution Gaming. Our focus is to deliver on our long-term plans and we have a joint plan for NetEnt and Red Tiger which focuses on hitting our numbers, something which I think is in the best interests of all parties concerned. Coming back to when we acquired Red Tiger, we wanted them to deliver and continue to do so and I think Evolution will have the same mindset, no one wants to mess anything up.
EGR Intel: Will the potential takeover of the business by Evolution Gaming help or hinder the progress of the Red Tiger migration?
TH: It’s a difficult one to answer, the migration of Red Tiger is in line with our plans and all the improvements that we’re making to the business so it’s natural that Evolution as prospective owners will want to continue that and not hinder it.
ll want to continue that and not hinder it.
EGR Intel: In what ways has the integration with Red Tiger transformed NetEnt into a more productive and faster-paced company than it had done previously?TH:EGR Intel: What are the significant synergies that will result from the Evolution Gaming takeover?TH:EGR Intel: Do you think the positive integration and benefits from the Red Tiger brand being brought into NetEnt accelerated the potential takeover of the business by Evolution Gaming?TH:EGR Intel: If the Evolution Gaming deal goes through, are there business concerns over trying to do too much at one time?TH:What we need to do is roll out with more operators in Spain and places like Italy and then start to deliver localised content for that market
What we need to do is roll out with more operators in Spain and places like Italy and then start to deliver localised content for that market
What we need to do is roll out with more operators in Spain and places like Italy and then start to deliver localised content for that market