IGT Sells UK Based Barcrest

The Barcrest Group, a British slots developer and subsidiary of Nevada-based International Game Technology (IGT), has found "an ideal new home," according to the parent company.

IGT announced this week that it has sold Barcrest to lottery supplier Scientific Games, with the transaction expected to close later this year.

IGT acquired Barcrest in 1998 and has carefully grown the business to become one of the premier providers of slot machines and gaming content in the UK and European markets.

Scientific Games has agreed to pay $54 million for Barcrest in net cash.

IGT will receive an additional $3 million in cash and could receive as much as $66 million at the end of the transaction, depending on post-closing adjustments.

IGT Chief Executive Officer Patti Hart said, "Scientific Games is an ideal new home for Bacrest and provides a strategic alignment between the core objectives of both companies.

Hart said that the sale of Barcrest would allow IGT to concentrate on other business lines.

Credit Suisse gaming analyst Joel Simkins said: "We see this sale as another signal that IGT management is focusing on exciting non-core businesses that consume cash and have modest growth potential."

Over the past three years, replacement sales on slot machines in UK pubs, clubs and bingo halls have stalled.

The UK gaming market, according to some analysts, is made up of low-cost, low-profit machines when compared to markets in the US and other countries.