Playtech Makes Billion-Dollar Bet on Italian Market with Snaitech Acquisition
Posted on: April 13, 2018, 02:00h.
Last updated on: April 13, 2018, 11:14h.
Playtech will establish a dominant presence in the burgeoning Italian gambling market through its biggest ever acquisition. The British online gambling software provider and financial trading group announced Wednesday it will pay $1.05 billion in cash and debt to take over the reins of Snaitech, one of Italy’s largest gambling operators.
As well as its biggest, it is also Playtech’s only rhyming acquisition to date – but talk about synergies!
Playtech said yesterday it had agreed terms to buy 70.6 per cent of the Milan-listed company from two private equity firms. On completion of that deal, it will acquire the remaining 29.4 percent of the company, subject to approval from remaining the shareholders.
In an official statement, Playtech described Italy as “Europe’s largest and growing gaming market” but noted it was also a fragmented one that is relatively underdeveloped online in comparison with the UK. The Italian market was worth an €20 billion last year, while the UK, the second biggest in Europe, was worth €16 billion.
New Consumer Focus Through Snaitech
“The acquisition of Snaitech represents the continuation of our strategy to invest in leading retail brands in fast growing, regulated markets,” said Playtech CEO Mor Weisner. “The acquisition delivers the Board’s strategic objective to improve the quality and diversification of Group revenue, whilst delivering exposure to high growth end markets, by utilising the strength of Playtech’s balance sheet.
Playtech has always been at the forefront of its industry and the acquisition offers the opportunity to create a vertically integrated B2B2C operator in Europe’s largest gambling market, delivering significant value to shareholders.”
The deal will also vastly increase Playtech’s consumer offering. The company’s focus has always been on providing B2B software, although it does have some consumer business in Spain and Mexico.
Playtech to Become Racetrack Owner
As well as owning an online business and sports broadcasting unit, Snaitech operates ten betting shops in Italy and franchises out a further 1,600 under the SNAI brand. It supplies its franchisees with around 54,000 slot machines nationwide and some 10,000 video lottery terminals.
Playtech will also inherit three race tracks, two in in Milan and one in Tuscany, an unusual departure for the online gambling giant.
Snaitech employs 850 people and last year generated revenues of €890 million ($1.09 billion), with pretax profits of €41.6 million ($51 million).
Playtech was founded in 1999 by the Israeli billionaire Teddy Sagi and supplies gaming software to some of the world’s biggest online gambling brands. It has made numerous acquisitions since its 2006 flotation on the London Stock Exchange and, today, employs 5,000 people in 17 countries. In recent years, Sagi has gradually sold down his controlling stake to 6.3 percent.
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