Churchill Downs announced Wednesday that it is selling its Big Fish Games division for almost a billion dollars.
The Louisville-based racetrack and gambling company bought Big Fish about three years ago for $885 million, so the all-cash deal will generate at least $105 million for Churchill.
Big Fish’s casino and games such as Gummy Drop were big hits, but in recent quarters the “bookings,” or in-app purchases, have been disappointing. The sale signals a major shift of Churchill Downs’ strategy; the company announced earlier this year that it is developing games for a historical horse racing gambling parlor that it’s opening in Louisville.
Churchill Downs Inc. said the buyer, Aristocrat Technologies Inc. a subsidiary of Aristocrat Leisure Limited, an Australian corporation, will pay $990 million.
“Big Fish is a very successful business with a bright future that will be best realized by being part of Aristocrat’s strategy and vision for their online and mobile gaming portfolio,” said Bill Carstanjen, CEO of Churchill Downs Inc. “We will refocus our strategy on our core assets and capabilities including growing the Kentucky Derby, expanding the casino segment, TwinSpires.com, and other forms of real-money gaming, and maximizing our Thoroughbred racing operations.”
The sale has been approved by the Churchill board of directors and is expected to close in the first calendar quarter of 2018. The board approved as much as $500 million of share repurchases from the proceeds of the Big Fish sale, according to the company.