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With new private equity owners, Pavilion Payments aims to grow its headcount this year and scan for acquisitions in the gaming payments space.
Payment processor Global Payments announced in February it was selling its gaming business to private equity firm Parthenon Capital Partners for $415 million; Parthenon said April 3 the deal had closed.
The sale puts a new name on “the same team, the same systems, the same technologies,” said Pavilion Payments CEO Christopher Justice during an April 5 interview. But Parthenon ownership plans to grow that team and double down on technology developments, he said, to serve what’s been a cash-heavy space now caught up in the digital payments transformation.
Las Vegas-based Pavilion Payments provides payments hardware, software and services – such as credit and debit card cash advance, cashless advance, online gaming solutions, traditional and digital check processing – to facilitate commerce on the casino floor, allowing consumers to access funds through cashiers, or via self-service methods.
The company also provides services through online gaming and betting platforms, including the casino-affiliated apps BetMGM and WynnBet as well as the fantasy sports betting service DraftKings.
Justice has been in the payments industry for about 30 years and joined Global Payments in 2017 to lead the gaming business.
Taking an increasingly omni-channel approach has been an important shift for the business to ensure casino patrons have access to their preferred transaction style, whether that’s face-to-face interaction with a cashier on a gaming floor, or a more discreet payment interaction with a kiosk or mobile device, Justice said.
“Our objectives really are to help our casino customers meet their consumers wherever they are and through whatever channel is most comfortable to them, because if we can create that level of comfort, then again, we’re more likely to see those customers more frequently,” Justice said.
Pavilion processed about $10 billion in payments last year, Justice said. The gaming business contributed about $100 million to Global Payments’ 2022 revenue, that company’s executives said in February.
Pavilion counts Everi Holdings and NRT Technology as competitors in the space, Justice said. London-based Paysafe has also made recent moves to facilitate mobile payments in the online gaming market.
Monthly revenue from casinos, sports betting and online betting in the U.S. reached $5.5 billion in January, according to the American Gaming Association.
The global online gambling and betting industry is expected to become a $144 billion market by 2028, according to banking giant JPMorgan Chase. That bank invested last year in the gaming payment service provider Sightline Payments.
Parthenon co-CEO and managing partner Brian Golson alluded to the opportunity in the gaming payments industry when he mentioned the firm spending five years “seeking a partner to help us take advantage of the modernization taking place in the gaming industry,” according to its news release.
Pavilion currently has about 400 customers, Justice said. Many of those customers “have multiple vendors providing services of one form or fashion, because they do like to have kind of diversity across their floors,” he noted.
Pavilion seeks to quickly increase the number of customers it serves, but Justice declined to specify by how much. He also declined to say how the company makes money.
All 180 employees working at the Global Payments unit stayed on after the business was sold to Parthenon, Justice said. Pavilion plans to hire about 90 workers this year to facilitate growth and technology development, he said.
The company is growing its service and tech support staff as well as its sales team, Justice said. With Parthenon’s backing, the company is also mapping out “more intense investment in our product set” and accelerating product development, Justice said.
There are a lot of aspects of the business that can be different when it’s not part of a Fortune 350 company, he explained. As a stand-alone entity, the business is able to make bigger reinvestments, he added.
Still, Pavilion is maintaining its tie to Global Payments, which will continue to provide payment processing services, Justice said.
With Parthenon intent on growth, Pavilion will consider acquisition opportunities to expand the business at a “much more rapid rate,” Justice said.
There are “some excellent opportunities out there” when it comes to merger and acquisition activity, Justice said, declining to identify any potential targets. Justice didn’t rule out the possibility of a purchase occurring this year. “I don’t think anything’s off the table,” he said.
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