XLMedia (AIM: XLM) has announced the successful completion of its divestiture of European and Canadian sports betting and gaming assets to Gambling.com Group Limited (“GAMB”). The sale, finalized on April 1, 2024, saw XLMedia confirm the receipt of a $20.0 million initial cash installment on the following day.

The agreement stipulates a total potential consideration of $42.5 million, with a guaranteed $37.5 million in fixed consideration.

Additionally, the deal includes an earnout consideration that could provide up to $5.0 million more, dependent on the revenue performance of the assets sold.

XLMedia anticipates incurring transaction-related expenses over the next six months to facilitate the asset migration. Despite these costs, the company expects to net approximately $35.0 million from the fixed consideration portion of the sale.

The Board of XLMedia has expressed satisfaction with the financial benefits realized from the transaction.

The net proceeds are slated for several strategic financial objectives: settling a $4.0 million deferred acquisition payment due in 2024, reinforcing the working capital for the company’s North American operations, resolving outstanding tax provisions, and distributing cash to shareholders.

With a continued strategic emphasis on the North American sports market, XLMedia aims to broaden its market presence, enhance audience engagement, and diversify its revenue sources.

These efforts are geared towards establishing a more predictable and stable financial foundation and expanding the company’s gaming vertical.

The Board remains focused on executing this strategy and exploring avenues to enhance shareholder value.