LAS VEGAS (AP) — Bally Technologies Inc. said Tuesday that it has agreed to buy fellow gambling equipment maker SHFL entertainment Inc. for about $1.31 billion in cash.
Bally says the addition of SHFL will complement its existing product portfolio, while also providing new access to land-based and online table games markets around the world.
Under the terms of the agreement, Bally will pay $23.25 per share for the company, which represents a 20 percent premium over SHFL's Monday closing stock price.
In premarket trading, SHFL shares jumped $3.95, or 21 percent, to $22.65. Bally shares rose $2.67, or 4 percent, to $63.58.
Bally, originally founded as a pinball machine maker in Chicago, started making slot machines in 1936. It now designs, manufactures, and distributes technology-based gambling devices and systems. The company also provides casinos with a variety of marketing, data management, accounting, player tracking, security and other software applications and tools.
SHFL, known for its automatic card shufflers, makes a variety of casino equipment, along with proprietary table, electronic table and online games.
Both companies are based in Las Vegas.
Tuesday's deal also includes debt of $8 million and cash of $41 million as of April 30. Bally said it expects the acquisition to eventually result cost savings of at least $30 million.
The deal, which remains subject to SHFL shareholders approval, is expected to close by the second quarter of calendar year 2014.