Double Down Interactive Acquired

January 13, 2012

Double Down Interactive are the developers and operators of the popular DoubleDown Casino, a fully socially interactive online casino which has become very popular over the last 12 months. In a surprise press release, news has broken of a takeover of the company by International Game Technology (IGT) who are well known as developers of both casino slots and online slots.

DoubleDown Social Casino operates almost entirely through social networking sites, and most significantly Facebook. IGT have stated that the reason for the acquisition of Double Down Interactive is to enable them to extend their reach by gaining access to an already well-established social networking brand.

If we consider that fact that since its launch in 2010, DoubleDown Casino has become one of the top four social media games offered on the Facebook site, and that it has a current player base of over 4,700,000 Facebook users, this acquisition makes perfect sense.

The cost of the merger is hard to define fully. It is thought to be made up of over $250 million in cash funds. An initial merger fee of $85 million will become payable immediately with the remaining $165 million to be paid across the next three years. IGT have stated that the finance for the merger is available on hand. Although this is a fairly small amount of investment for IGT, it could be an incredibly profitable one.

It is expected that IGT will begin to re-develop many of its most popular titles, both online slots and casino slots, to fit the social gaming format. The sheer number of current and potential players for the marketplace which DoubleDown Casino operates within is huge, and by acquiring what is in effect an off the shelf customer list, IGT are sure to profit if they manage to pull off the adaption of their top titles to the new format.

Social networking is a fairly unexploited avenue for online casinos at the moment; this is mostly due to the ambiguous legal situation within the countries which social networking sites are most popular. However, as we have seen recently, this situation is beginning to change. 2012 could well be the year in which we see online casinos shift their marketing focus to fully interactive social networking sites such as Facebook.

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