ARE TWO LISTINGS BETTER THAN ONE?

Gaming America speaks with Flutter Entertainment, Light & Wonder CEO Matt Wilson and Founding Partner & President of Innovation Capital Matt Sodl, about capitalizing on new markets with an additional public listing.

In the span of about three weeks, both Flutter and Light & Wonder announced approvals to pursue additional public stock listings. Flutter, an industry giant that owns FanDuel, currently has its primary listing on the London Stock Exchange (LSE), but will be seeking a US listing soon; while game developer Light & Wonder has its primary listing on the Nasdaq and has been approved to list on the Australian Securities Exchange (ASX). With the world of gaming becoming ever more connected, and nearly every operator and supplier looking to diversify into as many markets as possible, perhaps an additional listing could become a more standard industry tactic.

But what is the purpose of listing outside of a company’s ‘home country?' Every C-Level executive will tell you that additional listings, along with any other decision approved by a company’s Board, will maximize shareholder value. Beyond this, Gaming America spoke to Matt Wilson, CEO of Light & Wonder, and Founding Partner & President of Innovation Capital, Matt Sodl, as well as obtained comments from Flutter CEO Peter Jackson. How do these businesses plan to raise their stakes by diversifying their stocks?

The decision for Flutter to pursue a second listing – which will be on either the New York Stock Exchange (NYSE) or the Nasdaq – was approved by 99.99% of shareholders at the company’s Annual General Meeting. Flutter owns several household-name betting brands in the UK including Paddy Power, Betfair and Sky Betting & Gaming, as well as the popular US sportsbook, FanDuel. In Flutter’s Q1 financial report, FanDuel held a US sports betting market share of 50%. Without plans to either sell FanDuel or go through the process of an Initial Public Offering (IPO), Flutter's listing in the US gives the company opportunities for US-specific growth. Sodl said, “This listing is a means for Flutter to get more liquidity for its share trading. It provides opportunity to raise capital in a market where their sizable business operates.” Sodl, however, said a US listing will have “no bearing” on FanDuel’s independence from Flutter. He added, “It doesn’t strengthen independence, but the overall company.”

Flutter had been considering the decision for a few months before putting a second listing to a shareholder vote; a FanDuel Capital Markets Day report in November concluded that FanDuel was Flutter’s largest business, by revenue. The company’s view, supported by both investors and

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Catena Media Ceo Michael Daly On Us Listing

“Timing becomes everything because of market conditions, because of the markets we’re in and the markets we want to go to, as well as our own growth trajectory, and making sure that that’s a clear story and message. The next year and a half may be bumpy on some of the things in North America, so it’s making sure we can be clear enough to the market. Also the weight that bears on an organization to go through something like that can be distracting, and we want to make sure it’s not going to be distracting to the operational side of the business. The benefits are opening up new streams of investors. We have a large pool of individual investors in Sweden, which we very much respect. We have a couple of large institution investors, like North American investors. It is very difficult as an individual to invest in a company like Catena Media, which is in the Nordics. I’m probably on my eighth broker myself trying to figure out how to do that. There is more interest and appetite at the moment in North America around sports betting and the expansion of the business – I think this is why a number of companies are going there. The Nordic markets tend to be a little more contractionary in their interest in this type of activity, all for variously good reasons. But that means the better place to find capital and investment is probably in the Americas. There’s more desire there for this type of activity. That to us is: How do we unlock that? How do we make it easier for people to understand and invest in Catena Media, so we can open up more capital sources for potentially M&A. That’s sort of why we are looking at a re-listing or a dual listing, or all the ways you could get there, whether it’s mergers, what have you. There’s many ways and some are better for the company overall in terms of not shutting down or distracting the company so much while you actually go through such a process. An IPO is a very, very difficult process in the US with Sarbanes-Oxley and other things you’d have to go through. That will be a long and significant undertaking if we go that route. All options at this point are on the table and timing remains TBD. It has to be assessed.” shareholders, was that a US listing would enhance the group’s US profile, enable recruitment and retention of US employees, provide overall liquidity in Flutter’s shares and allow access to new capital markets and investors. As for which US stock exchange Flutter will choose, Sodl says, “More tech businesses tend to list on Nasdaq.”

Jackson said, “From our perspective, the things that are driving us to seek the US listing are ‘pull factors.’ It is about accessing capital markets in the US with the greater liquidity pool that they have; about the opportunity to have our brand talked about in the financial media in the US and, of course, there’s a strong overlap between the retail consumer in the US and people who would like to participate in FanDuel’s success and open accounts with us. We’d also like to use US-based equity to reward and retain our US colleagues, and do deals with other media businesses and partners. The fact is that 60% of our stake globally is now done in America. We’re delighted with the 50% market share and we’re delighted with the 95% growth year-on-year. We’re really consolidating our leadership position in America.”

Light & Wonder hopes to enhance the company’s presence within the Australian market, similar to the strategies of Flutter within the States, as well as increase the company’s profits Down Under. The company is looking for long-term investment opportunities, but we wondered if they weren’t also looking to equate themselves with direct competitors in the Australian market, like Aristocrat, by listing on the same exchange. Sodl, however, dismissed the competition angle. “It’s a way for Light & Wonder to provide access to share trading in Australia. There appears to be a sizable investor base for gaming tech businesses.” Sodl was also of the opinion that an Australian listing would not create a different perception of the company in that region. Wilson, a native Australian himself, noted the country’s prominence within the gaming industry as a whole, not just Light & Wonder’s success within Australia. He said, “You go to any gaming market around the world and you hear an Australian accent. Whether it’s on the supply side or the operator side, but also the investor side. Australian investors have had a lot of success investing in gaming businesses over the years.” Wilson also alluded to both his own and Executive Chair Jamie Odell’s previous roles with Aristocrat and how this experience still serves as inspiration for the Light & Wonder Board, but that the listing is not necessarily linked to Aristocrat doing the same. “We have a Chairman who was the CEO of Aristocrat through its transformation years and really took that business on an amazing journey in terms of shareholder value and gains over time. I was there for a long period of time.” Light & Wonder’s Gaming CEO, Siobhan Lane, also previously worked with Aristocrat for over a decade. As for Sodl’s comment regarding the size of the investor base in Australia, Wilson agrees on the potential for opportunity, saying, “Investors in Australia know the category really well. They understand the economics of how the gaming business works. I think investors love nothing more than an opportunity to invest in something they really understand. They’ve done all the heavy lifting and hard work to get their head around what drives this industry.” While Sodl also mentioned the possibility of longer trading days by listing within vastly different timezones, Wilson also mentioned the tendency of Australian investors to pursue business interests within the country. He said, “I think we’ve had a lot of inbound over the last three or four years, from Australian investors, who have these Aussie-only mandates. They can only invest in Australian companies. They’re saying, ‘hey, this is a really interesting story that we like, that we would love to invest in. How do we participate in the Light & Wonder story if we can’t invest offshore?’ Our main listing, or primary symbol, will continue to be the Nasdaq. We have the majority of our shareholders there, but we already have about 58% of the investor base that’s on the Australian dollar. By doing a secondary listing, they can move their Nasdaq stock down to Australia and hold their stock in Australian currency, and be able to trade it on the local market. It was a very demand-driven thing, with a lot of interest in how do we participate in this story.” Wilson said that the interest level from major and potentially Australian investors has already proven to be “very, very successful” with the amount of acquisition stocks “well above expectations.”

Sodl said that other companies operating with significant growth or presence in more than one country may perhaps consider additional listings in the future. It seems companies putting additional stock exchange entries on their 'to-do lists’ are just as interested in offering investors the opportunity to take part in a company’s progress and ‘story’ as they are in raising capital. Any competition between either operators or suppliers within the same market isn’t fought in the arena of that country’s stock exchange. Flutter’s stock price, at the time of writing, is £160.02 (US$203.90) per share on the LSE, while Light & Wonder’s stock price is $67.30. Both brands have seen a rise since January. It will be interesting to see how these prices are affected as the companies grow both ‘at home’ and ‘abroad’ in their new markets.

Gaming America spoke to executives and designers from Konami performance of a game comes down to the math on which it’s built; however, players will naturally gravitate toward certain visual and audio cues before they even take their first spin or experience any gameplay.

Gaming, Light & Wonder, Eclipse Gaming and Gaming Arts about how and why certain slot themes become successful.

Going For Gold

trending themes and how these machines will carry on into the future of gaming.

Konami Gaming SVP & Chief Games Product Officer, Gerard Crosby, told Gaming America, “The success of a popular game theme traces back to a compelling math model. If this math model is combined with attractive and memorable game mechanics, art, sound and packaging, then

Slots games and their designers try to draw on universal, relatable and memorable experiences. Popular themes gracing the reels of slot machines cover a wide variety of genres, all with the express intent of capturing the attention of a different kind of player. It may not be a surprise to learn that riches and wealth pop up in many slot games, but these symbols of luck and prosperity can vary greatly across different games for different markets. Konami Director of Marketing & Communications, Tashina Lazcano, notes popular themes can contain any form of currency including: “gems, coins, ingots, chips and gold.”

Bruce Urban, CPO at Eclipse Gaming added, “I think there’s association with those ancient times with wealth, gems, the pyramids and then the bearing of the leaders of that time with all of their wealth. dispense fruit-flavored gum and flash in the slot industry. Some of the other civilizations so popular even within some of with mechanics, it’s sure to be an entertaining experience for all players. And if done well, players will continually return to the game, seeking to reproduce or improve upon the experiences they’ve achieved in the past.”

Slot machines have captivated players long before they were ever placed in casinos, let alone made available online. The first slot machines were invented in the late 1880s and were found largely in shops, like barbers and cigar stores. Already a contentious subject by 1902, the initial ban of slot machines is what gave them one of their most iconic themes: fruit. While the machines could not offer coins as prizes after this official ban, they could dispense fruit-flavored gum and flash fruit-shaped symbols as a signal of winning. Today, colorful fruits still whizz past players on both traditional reels and video slot machines as one of the most popular themes in the slot industry. Some of the other themes filling casinos and iCasinos alike, however, have less of an obvious, storied history. Where did the buffalos come from (other than North America)? Why are ancient civilizations so popular even within some of the most modern video cabinets? When slot machines are designed for players of legal gaming age, why do we see so many cute baby animals, childhood toys and fairytale characters?

This view of a slot machine is inherently both simple and complex. Any game designer will agree that the actual

Gaming America reached out to representatives at Konami, Light & Wonder, Eclipse Gaming and Gaming Arts to delve deeper into the thought process – and the slot process – to learn more about the industry’s evolution over time, current the slot process – to learn more about

Any slot machine theme that gives you the right connection with wealth is attractive.” Urban also said that the color gold, or at Eclipse Gaming ‘golden sand,’ is also used often in his game design, even when gold coins themselves are not.

Matt Wilson, Light & Wonder CEO, agrees, stating, “I think it’ll continuously evolve. Some of these Egyptian themes or dragon themes – the underlying ideas of wealth and prosperity – I think they’ll still resonate with players, but I think the real creators in the industry are trying to push the boundaries on what new worlds of play can mean.”

Being immersed in reels of wealth, warriors, heroes and winning can certainly put a player in the mindset that they are on an exciting course to victory themselves. The jackpot may be the destination, but designers work to make the journey just as rich.

Going Back In Time

Along with the excitement of fortune and the potential of winning, one of the other biggest motivators for players and designers alike seems to be the pull of nostalgia. There are many games with bright colors, cute animal characters, familiar tales and themes specifically chosen to delight not children, but the inner child of a player demographic. Rubber ducks and piggy banks aren’t staples of today’s children’s toys, but can be seen in Eclipse games, for example. These images and motifs serve as a delightful reminder that we were all children at some point, and that gaming is intrinsically about play. Urban said, “If you pick themes that people can relate to when they walk up to the game, that relationship is there. As the demographics in the market change, we pay attention to what was popular in their upbringing.” He expanded on his point with the mention of another popular theme for the kid-at-heart: candy. “We’re not supposed to have candy; it’s bad for us. But there’s some elements of, ‘Ah look at that! I can play this candy game!’”

Jean Venneman, Gaming Arts COO, shared in the desire for nostalgia in games. She told Gaming America , “When I see something that reminds me of my childhood, that’s generally a positive feeling, so we want to recreate that with our playerbase.” Venneman also commented, “When we started launching machines into the industry in 2019, it seemed like the market at that point was heavy towards really serious themes.” Now, for every serious warrior or dragon on the hunt for gold, there’s a light-hearted rubber duck or delicious sweet to balance the casino experience, whether on the floor or online.

Going With The Flow

The production of the perfect slot game has so far relied on the use of captivating visuals to create memorable characters and emotionally accessible themes; although, sound design also plays a hugely important role within the slot industry. Sound is key, even when considering those near the machine, but not playing it. Volume of the games must be kept in balance with their surroundings, so that the games’ sonic atmosphere need not compete with either bartenders trying to hear guests’ orders or neighboring slot players hearing their own games. The flow, rhythm and melody of the games all influence anyone who can hear them.

Venneman noted that sometimes the proximity of Gaming Arts machines to each other may influence the balance of the games’ audio as well saying, “Sound is critical. If we have a few of the same games in the same area and one, for whatever reason, doesn’t have its sound on (or it’s on low), we see a performance difference because the player experience is multisensory.” For every visual cue advancing the story of the game, there is an accompanying sound to notify not only the player, but also everyone in the vicinity, for a communal experience where progress and bonuses can be celebrated together.

Urban spoke from the point of view of both casino-goer and gaming industry developer. He began, “I might not be winning, but it’s nice to hear someone around me is at least winning. It helps everyone enjoy the game.” What qualifies as mutual enjoyment for most players, however, may also inform gaming professionals and more veteran slot aficionados. “I know very specifically what the celebration sound is for an IGT machine. I know what the celebration sound is for Aristocrat. So, I not only know someone’s winning, I actually know on what particular kind of machine.”

Speaking of Aristocrat, as for the persistent success of the brand’s Buffalo-themed slots, maybe this harkens back to a simpler time as well. Urban brought up the ‘screeching eagle’ sound that ‘cuts through’ casino floors during a Buffalo win. Yet Wilson countered, “I think the buffalo games haven’t necessarily done well in markets outside of the US, because buffaloes aren’t really a thing in other parts of the world.” The Buffalo, or the American

Bison as they’re often referred to outside of the gaming industry, is the largest North American mammal. Perhaps these megafauna purely symbolize the largest wins. Casino-goers may also close their eyes and picture ‘the home where the buffalo roam’ as the peaceful lyrics of “Home, Home on the Range” fill their minds – until that eagle screeches out a win.

Going Back To Basics

Another motivator that may come as a surprise is tradition. Along with both the ever-trending themes and first-to-market themes, it’s not unusual for tried-and-true classics to perform well. Though the slots of today no longer dispense fruity chewing gum, fruits are still such a popular slot theme that the gaming devices themselves are still also referred to as 'fruit machines.’ Venneman commented, “The traditional sort of gaming experience with the bars, the cherries and the sevens still has a place in the market. Players tend to enjoy having new experiences, but then they have their good old favorites. There have been machines that have been on the floors for 20+ years. Players love the games they feel comfortable with . ”

Anyone looking to create the newest, flashiest video cabinet need not fear, though. As with any form of technology, it will all be down to individual preference whether a player relies on a classic or jumps at the chance to try something new. Urban discussed that there is absolutely a market for both of those options and a slot out there for any type of player. He said, “There’s still a lingering player that plays stepper games, mechanical reels. When they first came out, there were no video displays, so it’s very obvious what you’re chasing and what you’re playing for. There’s still a player demographic out there where that is very important to them. If you do interviews with video players, it’s like what are you playing for? ‘I don’t know. I’m just hitting the button and then hopefully something cool happens.’ Two different demographics.”

The charm of mechanical slots and their clear processes and outcomes have, though, been largely overtaken by the convenience of not carrying nickels. Even the most traditional of players would probably agree. Other traditions could be classified more as superstitions. If playing slots is all about reproducing luck and good memories, what is the easiest way to ensure that happens? Gaming Arts features one series of slots themed around different beverages – which may correspond to a player’s drink of choice while at the casino. Certain players prefer to choose the same game each time they play, or even sit at the same, physical machine. Venneman explained, “I do know that players are very superstitious, they have their rituals and their routines. They know if they wear certain socks or if they drink a certain drink while they’re playing that they’re going to have better luck. And those are all fun things to see.”

Going The Distance

By both sight and sound, slots have come a long way since their inception. A number of slot games today may not even fully earn the title of slot ‘machine.’ That mechanical element is missing from not only the slots which populate online casinos, but has also been smoothed out of existence in the latest and greatest video cabinets as well. Technology can be cyclical, however, even as it innovates. Though aspect ratios, screen sizes and cabinet designs have all changed, video reels may still seek to emulate the familiar sounds that mechanical reels made. Urban commented that the evolution of screen sizes and ratios has “changed the game.” He added, “Game designs can change to growing reels because now I can have that extra real estate to grow the reels.”

With the advancement of the cabinets also comes the advancement of the story of the game itself. Wilson said, “It’s not just about spinning, reels, mechanics and symbols, it’s: what’s this experience that we’re trying to create?” When asked what is trending now in the industry, everyone who spoke to Gaming America agreed that it’s all about the bonuses and features within a game. Crosby and Lazcano stated, “Cross -screen animations and many, elaborate bonus features” are the aim of Konami’s current game library.

Urban described the rationale behind incorporating those features, “I’m going to say I coined a kind of phrase: feature forward. We build in bonus features and other things within games. Oftentimes, the chase is about the feature; it’s like the climax of the story. As we design games, we try to put different feature elements in. You’re getting some reward other than just your reel pays. That is something we’ve noticed players responding to.”

Venneman also looked at extra features from a player’s point of view. “Players are a little bit more interested in more entertainment value in the game than maybe they had been prior. They’d like to see a variety of bonus experiences and ways they can win. The player can play the game multiple sessions, multiple times and discover different things while they’re playing it.” Everything leads back to creating a layered, repeatable and playful experience. Regardless of all the (sometimes literal) new bells and whistles, slot games are still designed to be enjoyed again and again.

Reeling It In

This brings us to the slot games of the future. It seems as if any predictions about what themes will populate tomorrow’s, next year’s or next generation’s most successful games can be made based on who is playing them. Wilson said, “One thing that we always say at Light & Wonder is: we’re in the fashion business; the taste for different types of games changes every season. The next round of games needs to be really tailored to what the consumer is looking for today.”

The player’s quest for luck, nostalgia, excitement, replay value – and of course, a jackpot – will inspire game designers, while the technology to enhance that player’s experience will be created in harmony with that quest. The mystery of spinning a reel and the accompanied waiting for a number of possible outcomes may be a predetermined mathematical equation for a game designer, but for a player enjoying the game, it’s something else entirely.

Slots seem to sit at the intersection of luck and skill, with some players seeking to predict what they might see and others merely along for the multisensory ride. Knowing the odds doesn’t make it any less fun to try and beat them. Urban said a slot machine is “definitely a game of luck” and not necessarily a game of skill. However, he then concluded, “Maybe that skill is just hearing the sounds, knowing someone else is winning and still having a good time.”