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June 20, 2024

BGL Announces GENDA Inc. has Reached a Definitive Agreement to Acquire National Entertainment Network

Brown Gibbons Lang & Company is pleased to announce GENDA Inc. (“GENDA”) has signed a definitive agreement to acquire all equity interests of National Entertainment Network, LLC (“NEN”), a leading operator and provider of amusement vending machines in the United States through Kiddleton, Inc. (“Kiddleton”), a Dallas-based consolidated subsidiary of GENDA. BGL’s Consumer investment banking team is serving as the exclusive financial advisor to GENDA in the transaction.

Headquartered in Tokyo, Japan, GENDA is an entertainment company that aims to increase the “total volume of fun” around the world through its diversified range of business activities, including amusement arcade, karaoke, food and beverage, character merchandising, and content & promotion. GENDA’s platforms includeGiGO and the karaoke chain BanBan, as well as mini locations of non-staffed gaming areas in Japan, North America, mainland China, the UK, and across the Middle East.

Kiddleton, an operator in GENDA’s mini-location business in the U.S., has more than 400 locations that offer small Japanese-style prize machines (arcade games designed to win prizes) and prizes with Japanese-style “Kawaii” designs, which were previously unavailable in the U.S. market. GENDA is developing its business with a unique focus on “products and experiences that can only be obtained here.”

NEN is a leading operator and provider of amusement vending machines, including skill cranes, bulk vending, “kiddie” games, and video games across approximately 8,000 locations in the United States. NEN has achieved sales of approximately $100 million and operating income before depreciation and amortization of approximately $8 million. NEN boasts a large network of grocery and retail customers in the U.S., including Walmart, Kroger, and Denny’s. Additionally, NEN has a nationwide maintenance network and operates a manufacturing facility in Grand Prairie, Texas, where they repair, wrap, and store gaming equipment. NEN is working on a digital initiative that allows users to take part in a digital rewards program and allows players to experience free plays by scanning QR codes on machines.

GENDA anticipates integrating the NEN acquisition with Kiddleton’s existing expertise, which features sales per location three times higher than NEN’s. The integration will include NEN’s maintenance networks, streamlined operations for cash collection and prize replenishment, prize and equipment procurement synergies, the rollout of additional credit card readers, and the promotion of digital membership programs. This acquisition is part of GENDA’s roll-up strategy to expand business operations in the United States and increase profit contributions to the companies in GENDA’s company group.

BGL’s Branded Consumer Products investment banking team has extensive expertise and a track record of successfully assisting branded consumer companies achieve outstanding results across a range of subsectors. Our Consumer Group is a leader in eCommerce investment banking for the middle market. Our team has the technical expertise, positioning strategies, and growth-oriented projection models to ensure branded and managed marketplace DTC & B2B eCommerce platforms are optimally positioned to achieve outlier valuations

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