Jumbo Interactive Ltd (ASX: JIN) shares are having a poor session on Thursday.
In morning trade, the ASX 300 stock is down 5% to $12.06.
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Why is this ASX 300 stock falling?
Investors have been selling the online lottery ticket seller's shares this morning after it announced its second acquisition in as many weeks.
It is possible that some investors fear the ASX 300 stock is biting off more than it can chew with these deals.
According to the release, the company has signed an agreement to acquire Dream Giveaway USA for $55.4 million (A$57.8 million including adjustments).
Dream Giveaway USA is a well-established business in the US prize draw market known for its high-value, automotive-themed giveaways and charitable fundraising partnerships.
The company notes that the deal gives it a direct foothold in one of the world's largest and most digitally engaged consumer markets. It also marks a major step in the company's strategy to diversify and accelerate global growth.
A big move into the US
The release reveals that Dream Giveaway USA operates a profitable business-to-consumer model that has built a strong reputation for trust through long-standing ties with non-profit organisations.
Jumbo's CEO and founder, Mike Veverka, said the acquisition provides a ready-made platform for the company to expand in the US. He commented:
The acquisition of Dream Giveaway USA provides Jumbo with an entry point into the US prize draw market via a wellestablished and profitable operator with a consistent track record of performance. Jumbo can accelerate the business with its software platform and 25 years of digital marketing expertise."
The CEO of Dream Giveaway USA, Ryan Maturski, welcomed the deal. He said:
Dream Giveaway USA has successfully grown over the past seven years into a leading brand in the US prize draw market. Jumbo brings considerable digital expertise to help us achieve the next level of growth.
Why is the ASX 300 stock making this move?
Management advised that the deal is part of a broader push to diversify earnings and expand its global footprint. It follows the acquisition of the UK-based Dream Car Giveaways earlier this month.
The company will fund the purchase through a mix of existing cash and debt drawn from its recently upsized $120 million ANZ facility, providing flexibility for future expansion.
Based on Dream Giveaway USA's adjusted EBITDA of US$4.6 million for the 12 months to July 2025, the acquisition multiple comes in at around 7.8 times EBITDA. This is a reasonable price for a growing and profitable business.
For FY 2026, management is forecasting an underlying EBITDA contribution of US$2.7 million to US3 million from Dream Giveaway USA. This excludes initial investment costs to support digital marketing and migration to Jumbo's proprietary lottery platform.
As a result, the ASX 300 stock expects the acquisition to deliver low-to-mid single-digit earnings per share (EPS) accretion in the first year post-completion.
