Light & Wonder: Moving Primary Listing to ASX

Light & Wonder (LNW) ($6.5B market cap, $11.3B EV) is a Las Vegas based maker of video gaming terminals, shuffle machines, other table products, etc., plus they now own 100% of SciPlay (SCPL) after the 2023 buyout and have a growing iGaming unit.  This is the old Scientific Games (SGMS), they sold their lottery business to Brookfield (BN) in 2022 for $5.8B and the name went with the lottery business.  

Light & Wonder is undertaking a strange move, the company is currently traded in both Australia on the ASX (which they only added  as a secondary listing in 2023) and the U.S. on the NASDAQ, but after 11/12/25 (this coming Wednesday) the shares will be delisted from the NASDAQ, any remaining shares trading on the NASDAQ will move to OTC.  A popular strategy in recent years to increase your multiple has been to move listings to the U.S., but here Light & Wonder is doing the reverse which piqued my interest.  This is a global company, 2/3rds of their workforce is overseas, but only 5% of their revenue is generated from Australia, why pick Australia?  In the company's own words:

Rationale

The decision to transition to a sole ASX primary listing reflects Light & Wonder’s strategic focus on aligning our capital markets presence with our long-term growth plans and shareholder base. We are seeking to consolidate trading liquidity onto the ASX, a deep and liquid market that has a robust understanding of the gaming sector.

Translation: Multiples for gaming companies tend to be higher in Australia, for example, The Lottery Corporation (ASX: TLC) trades for 20x EBITDA, Brightstar (BRSL) trades for 7x EBITDA in the U.S., there some moving parts in there that may account for some of the difference, but they're largely similar businesses.  Light & Wonder's closest peer, industry leader Aristocrat (ASX: ALL) trades for 14x NTM EBITDA, while LNW trades for 8x.  Aristocrat has no net debt and is significantly larger, probably deserves to trade at some premium to LNW, but there's room for LNW's multiple to expand.

The next few days will likely have some volatility, there could be some forced selling in the U.S. as indices kick LNW out and then on the other end, forced buying as Australian indices include LNW.  Additionally, LNW is accelerating its buyback, "we expect to utilize a meaningful share of the remaining available $735MM capacity prior to the end of 2025."  Hard to tell how this will all shake out in the near term.

I posed the idea on Twitter/X and received a couple thoughtful responses:

I bought a tracker position last week, might increase it depending on what happens.  Keep in mind if you buy shares on the NASDAQ, you'll have to get in touch with your broker quickly and convert the shares to the ASX (they won't automatically) otherwise be stuck with shares that trade over-the-counter.

Disclosure: I own shares of LNW