TORONTO (Reuters) - Canadian gaming company Innova Gaming Group Inc said on Wednesday its initial public offering priced below its targeted range and it will raise C$49.08 million ($40.9 million).

Last month, Amaya Inc, the owner of online gambling sites PokerStars and Full Tilt, announced plans to spin out and list its Diamond Game subsidiary into a new entity dubbed Innova Gaming. Diamond Game designs, develops and markets games mainly for the North American lottery industry.

The offering priced at C$4 a share, below the targeted range of C$4.50 to C$5. Innova will get gross proceeds of C$15 million from the offering. Amaya, which is selling some of its stake in a parallel secondary offering, will take home C$34.08 million.

Amaya had initially planned to raise C$48.2 million via its secondary offering and retain a 33 percent stake in the company. In regulatory filings on Wednesday though, Innova indicated that Amaya will now retain a roughly 40 percent stake in Innova.

Shares in Amaya were trading 3.7 percent lower at C$29.07 in afternoon trading on the Toronto Stock Exchange on Wednesday.

Amaya, which transformed itself last year following its $4.9 billion takeover of Rational Group, has been selling or spinning-out non-core assets over the last few months.

The company, which has pivoted to focus on the business-to-consumer market from the business-to-business segment, last month agreed to sell its Cadillac Jack unit that makes slot machines and electronic bingo games for casinos to an affiliate of private equity firm Apollo Global Management LLC for C$476 million.

(Reporting by Euan Rocha; Editing by Lisa Shumaker)