Company to purchase VirtGame for $20 million

Single Sign-On: You can use Facebook account to log in to LasVegasSun.com. (We will use your first and last name from your profile.)
Trusted Commenting: Facebook connected users automatically become trusted commenters.

Wednesday, Feb. 23, 2005 | 9:13 a.m.

Progressive Gaming International Corp., the designer of casino-management software that's changing its name from Mikohn Gaming Corp., will acquire VirtGame Corp. for about $20 million in stock to add a developer of slot-game software.

Progressive Gaming said in a statement it will exchange 2 million shares for all the common stock, warrants and preferred stock of San Diego-based VirtGame. The transaction values VirtGame at about 31 cents a share, based on VirtGame's 63.6 million fully diluted shares outstanding, or an 11 percent discount to Friday's closing stock price of 35 cents.

The acquisition price is subject to adjustments for VirtGame's working capital and a bridge loan of as much as $2.5 million, said Michael Sicuro, Progressive Gaming's chief financial officer, in an interview. He said options and warrants that aren't exercised by holders won't be automatically converted into Progressive Gaming shares.