Today, Playtech revealed that it has reached an agreement with Snaitech, under which the British gambling technology company is to acquire an approximately 70.6% stake in the Italian betting and gaming operator. The prize of the deal is estimated to €846 million. The acquisition is to be funded by the existing cash of Playtech, as well as by a new debt.
After the initial acquisition is finalised, the UK-headquartered gambling tech firm is to be required to place a mandatory takeover bid for the remaining stake in Snaitech. Of course, the initial acquisition’s completion would have to get the approval of both the shareholders and the competent regulatory authorities. The deal is expected to be finalised in the third quarter of 2018, with the overall transaction set to be completed by the end of the year.
The Italian gambling company’s takeover is considered to be part of Playtech’s efforts to generate most of its revenue from regulated global gambling markets. After the deal with Snaitech is finalised, the combined company is set to generate almost 80% of its overall revenue from regulated markets. Currently, Snaitech is fully regulated in the markets where it operates, as revealed by Playtech.
Snaitech is also known for its involvement in racetrack management and television services. Reportedly, the Italian gambling operator’s full-year 2017 revenue amounted to €890 million, while its annual core earnings were estimated to €136 million.
Snaitech Acquisition Part of Gambling Market Consolidation
The acquisition of Snaitech comes at a moment when Playtech has been facing the stricter rules resulting from UK regulatory authorities’ crackdown. Drastic reduction of the maximum stake allowed on controversial fixed-odds betting terminals could also be expected to be imposed as part of the the ongoing clampdown carried out by the UK Government on the gambling sector.
As Casino Guardian has reported on a number of occasions, there has been a wave of consolidation in the UK domestic gambling market, as more gambling operators have been trying to keep their market share in order to be able to face the stricter regulatory regime that is being rolled out by country’s gambling watchdogs.
The takeover of Snaitech is expected to create a leading vertically-integrated land-based and web-based Italian gaming business that would also be able to control its own technology across all the available products, both in the retail and online sector. In addition, the acquisition is also set to significantly boost the British online gambling technology company’s revenue from regulated markets, not to mention the fact that Playtech would be able to take full advantage of the dynamic and fast-growing Italian market.
As said by the Chief Executive Officer of Playtech Mor Weizer, the acquisition of Snaitech perfectly illustrates the efforts of the UK gambling technology company to invest in top retail brands operating in fast-growing and regulated markets worldwide.