Flutter Entertainment, a major player in the global gambling market, known for its ownership of Paddy Power, is currently negotiating to acquire Snaitech, the consumer division of Playtech. This deal, potentially worth about £2 billion, is part of Flutter’s ambitious expansion strategy.
Detailed negotiations underway:
Reports from Sky News indicate that the discussions have reached a sufficiently advanced stage, suggesting that an official announcement may be imminent, signaling a significant reshaping of the gambling industry’s dynamics.
The talks between Flutter and Playtech have reportedly reached a point where transparency with the public may soon be necessary. Although a formal deal may not be finalized until the following month at the earliest, the potential acquisition price points to a valuation of Snaitech that exceeds Playtech’s current market cap. As of Wednesday morning, Playtech was valued at approximately £1.66 billion with shares priced around 548p each.
Snaitech, which operates under the well-known Snai brand in Italy, has demonstrated solid growth with a 5% increase in revenues, totaling €946.6 million last financial year. This performance has solidified its status as a top contender in the Italian sports betting market. The integration of Snaitech into Flutter’s portfolio would transform Playtech into a focused business-to-business (B2B) entity, possibly attracting further investment interest.
This acquisition aligns with the ongoing corporate strategy led by Peter Jackson, CEO of Flutter Entertainment. The company has recently shifted its primary stock market listing to the United States, which has sparked a debate regarding the attractiveness of the London stock market. This move is viewed as part of a broader strategy to fortify Flutter’s position through selective acquisitions globally.
Previously, Flutter has expanded its Italian market presence by acquiring Sisal, another prominent gambling entity. The operational synergy between Sisal and Snaitech, post-acquisition, remains under strategic review, with potential benefits from their integration not yet fully disclosed. This ongoing consolidation is evident in Flutter’s robust financial performance in the recent quarter, closely mirroring the positive financial revelations from its rival, Entain, which owns Ladbrokes.
Playtech’s recent corporate history:
Playtech has been at the heart of several high-profile corporate developments over the past few years. In 2022, its shareholders rejected a takeover bid from Aristocrat Entertainment, an Australian company. Following this, Playtech considered a merger with the struggling 888 Holdings, recently rebranded as Evoke, although these discussions ultimately fell through.
The acquisition of Snaitech by Flutter would not only enhance Flutter’s already impressive portfolio but also signify another major chapter in the company’s relentless pursuit of growth under Jackson’s leadership. With a market capitalization nearing £26 billion, Flutter is strategically positioning itself as a powerhouse in the gambling sector. As the negotiations progress, both Flutter and Playtech have withheld comments on the potential deal.
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