Scientific Games, a leading developer of technology-based products and services and associated content for worldwide gaming and lottery markets, has entered into a $5.1 billion acquisition/merger agreement with Bally Technologies, a supplier slot machines, table game products, systems, mobile, and iGaming solutions, in which Scientific Games will purchase Bally for $3.1 billion and assume $1.8 billion in Bally debt.

The deal, which has been approved by the board of directors for both companies, is still subject to approvals from Bally shareholders and state and federal regulatory agencies, and is expected to close in early 2015, according to company press materials. The acquisition will be financed with debt and cash on hand.

The transaction would expand Scientific Games’ portfolio of products and solutions to include leading casino management systems and table products, including automatic shufflers, proprietary table games and electronic table systems. It would also expand the range of Scientific Games’ social and real-money iGaming and iLottery products and services.

This expanded portfolio is expected to position Scientific Games to better cross-utilize content and technology across the lottery, gaming and interactive sectors to propel future growth. Scientific Games and Bally generated combined revenue of approximately $3.0 billion in the 12-month period ended March 31, 2014. Scientific Games expects to achieve an anticipated $220 million of cost synergies and $25 million of capital expenditure savings by consolidating operations and generating efficiencies in the areas of manufacturing, engineering, field and customer service and administrative operations.

The share price for Scientific Games stock jumped 17 percent today after the deal was announced early this morning, according to the Wall Street Journal. The share price for bally was up 29 percent.

Upon closing of the transaction, Richard Haddrill, CEO for Bally Technologies and David Robbins, chairman of the board of directors for Bally, will join the board of directors of Scientific Games, with Haddrill anticipated to serve as vice chairman. Gavin Isaacs, president and CEO of Scientific games, will continue in his role. Isaacs has previously held high-level executive positions with Bally and Bally subsidiary SHFL entertainment.

“The acquisition of Bally provides us with a unique opportunity to combine two exceptional companies with long track records of creating leading-edge games and gaming technology products for players and delivering innovative solutions to our customers,” said Isaacs in a prepared statement. “With leading gaming, lottery, and interactive content, world-class systems capabilities and table game offerings, we believe that the combined company will be uniquely positioned as a strategic partner for gaming and lottery operators, offering a highly diversified suite of value-enhancing products and services across multiple worldwide distribution channels and platforms… The combined company will feature world-class research and development capabilities, an expanded base of recurring revenues and greater worldwide penetration in key geographies, including the AustralAsia region. In addition to the strategic value of the transaction to our customers, we expect to create significant shareholder value as the transaction is expected to deliver immediate earnings and cash flow accretion and will allow us to meaningfully reduce our leverage over the next three to four years.”

“The combination with Scientific Games will benefit our customers and shareholders,” Haddrill said. “Increased scale, geographic diversity and product development capabilities will create a new runway of growth opportunities through new products and a comprehensive portfolio of customer-focused solutions. This transaction delivers immediate value to our shareholders, and the highest share price in our history. We look forward to working with our new colleagues at Scientific Games to execute a detailed integration plan to realize customer satisfaction and additional value.”

The Scientific Games/Bally Technologies arrangement is just the latest in a spate of large-scale gaming supplier acquisition/mergers that have occurred over the past year. In July, Italy-based lottery and gaming provider GTECH acquired International Game Technology, the slot, systems and online gaming supplier, for $6.4 billion—$4.7 billion in cash and stock and the assumption of $1.7 billion in outstanding IGT debt. Some gaming analysts suggest the Scientific Games/Bally arrangement may have been a response to this early deal.

Earlier this summer, Aristocrat Technologies announced the $1.28 billion purchase of Video Game Technology, a Tennessee-based producer of Class II slot games and systems for the tribal gaming market. Last year, Scientific Games acquired WMS Gaming for $1.5 billion and Bally Technologies bought SHFL entertainment for $1.3 billion.

The slow recovery of the North American casino industry from the recent recession is often given as the reason for the uptick in merger and acquisition activity among gaming suppliers. The industry is also facing issues with weak consumer spending, casino oversaturation, competition from the Web, the decline in core casino gamblers and difficulties adapting product the younger generations.