Light & Wonder Paying $850 Million for Charitable Gaming Assets

February 18, 2025

Light & Wonder (NASDAQ: LNW) announced it will pay $850 million in cash for the charitable gaming assets of Grover Gaming, Inc. and G2 Gaming, Inc. The total payment could rise to $1.05 billion depending on a “four-year revenue-based earn-out of up to $200 million.” 

The starting purchase price suggests that the buyer is paying roughly 7.7 times Grover Charitable's adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for 2024 and around 7.1 times the target's adjusted EBITDA run rate.

"Under the terms of the agreement, Garrett will collaborate with Light & Wonder to help drive the continued success of the business over the next three years,” according to a statement.

Light & Wonder anticipates that the deal will conclude in the second quarter and mentioned that once completed, the operation will be managed by a mix of LNW and Grover Gaming staff. 

What L&W Gains from Grover Charitable Acquisition 

Charitable gaming includes the financial risks and possible winnings found in traditional casino betting; however, it is distinct because it is not managed by a commercial enterprise, tribal operator, or government entity. Instead, it's operated by a nonprofit that delegates gameplay to a firm like Grover. It can be presented in multiple formats, such as lotteries, table games, and slot machines — a sector where Light & Wonder stands out as a leading player. 

By acquiring Grover Charitable, Light & Wonder obtains a company that has over 10K gaming machines distributed in Kentucky, New Hampshire, North Dakota, Ohio, and Virginia. The privately owned seller was established in 2013 by Garrett Blackwelder and is located in North Carolina. 

“Grover Charitable Gaming has developed long-standing and persistent relationships with charitable customers in the states that it operates, underpinned by a dedicated local team of service technicians and relationship managers,” according to the press release.

The agreement specifies that the seller will collaborate with Light & Wonder for three years after the deal's completion to guarantee “the ongoing success of the business.” 

Light & Wonder States Agreement Will Not Increase Leverage 

Light & Wonder is funding the purchase of Grover Charitable through a combination of cash and debt, but the firm informed investors that the acquisition does not jeopardize its objective of maintaining leverage between 2.5x and 3.5x. 

According to the preliminary financial figures for 2024, Grover Charitable reported an adjusted EBITDA of $111 million with sales totaling $135 million, suggesting that Light & Wonder is purchasing a successful enterprise. The purchaser reiterated its adjusted EBITDA projection of $1.4 billion for this year, informing investors that the estimate excludes possible increases from Grover Charitable. 

“Light & Wonder reaffirms its 2025 $1.4 billion Consolidated AEBITDA Target underpinned by continued strong organic growth across our existing businesses, and without any AEBITDA contribution from the acquisition of Grover Charitable Gaming,” said the company in the statement.