👉 Background: Aristocrat Leisure and gambling go hand-in-hand. It was founded back in 1953 and floated on the ASX in 1996. It produces everything from electronic gaming machines to digital social games.

👉 What happened: Last year, Aristocrat Leisure wanted to get its paws on a digital gaming player called Playtech, but failed in its acquisition attempt. But now, it has managed to snag NeoGames, an Israeli gaming company in the online lottery market, for $1.5 billion.

👉 What else: Neogames has a strong presence in North America and Europe. And given the deregulation happening across the US' gaming industry, this has become a huge opportunity. Aristocrat is clearly not afraid to place big bets on its diversification strategy.

What's the key learning?

💡Don’t put all your eggs in one basket, especially in a highly regulated market. Diversification involves spreading investments across various business sectors or regions - all with the plan to reduce the risk.

💡By acquiring NeoGames, Aristocrat Leisure is diversifying its product offering, but it's also diversifying its geographical footprint.

💡 Aristocrat Leisure still makes a large chunk of its revenue from gambling machines, so there's a huge opportunity to grow in the online lottery and casino space.

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