Playtech Seals Major Long-Term Deal with GVC to Supply Content Across All Brands
Posted on: February 28, 2019, 04:32h.
Last updated on: February 28, 2019, 04:32h.
Online gaming software giant Playtech has signed a long-term deal with GVC Holdings that will it see it provide all its products and services to all of GVC’s brands. The two companies are already commercial partners, but the new deal will expand the scale and duration of the partnership significantly.
The agreement, announced Wednesday, consolidates the relationship between two heavyweights of the industry for the next six years. Playtech’s portfolio will be made available to GVC brands like Ladbrokes, bwin, Sportingbet, partypoker and Foxy Bingo, as well as to its new 50-50 joint-venture with MGM, ROAR Digital, in the US market.
ROAR Digital was formed in July last year with the goal of cornering the emerging US sports betting market, with GVC and MGM each investing $200 million into the venture.
Playtech’s Snaitech Paycheck
Delivering its financial results last week for the year ending 31 December 2018, Playtech said it would “continue to focus on growing its relationship with existing clients by expanding into new geographies and/or additional products.”
The group reported a 54 percent increase in revenue and 7 percent increase in EBITDA during 2018. That followed a torrid 2017 when a clampdown by the Malaysian government on online gambling decimated its client base in one of its primary Asian markets.
In July 2017, Playtech’s shares were at an all-time high, giving it a market cap $4.6 billion, but they were battered in November of that year when the company was forced to issue a profit warning due to Malaysia and they have fallen by over 60 percent since that peak.
Having had its hand bitten by the unregulated Asian markets, the company is now focusing on regulated market growth. That goal was furthered through Playtech’s £1.05 billion acquisition of Snaitech last year.
Unregulated Markets ‘Unavoidable’
Snaitech’s “SNAI” is a market-leading retail brand in the fast-growing Italian market, with over 1,600 franchised betting outlets and 10,000 video lottery terminals. The acquisition helped offset much of the loss of the Asian markets and was largely responsible for providing Playtech’s revenue boost in 2018.
In an interview with Gambling Insider last week, Playtech CEO Mor Weizer said his company now operates in more than 30 regulated markets, more than any other online gaming supplier, although he acknowledged that unlicensed markets are unavoidable for a company that partners with blue chip operators — and that includes GVC.
“Obviously, the three largest brands — which are all operators — build their business in a combination of regulated and unregulated markets, including GVC and PokerStars,” he said.
“Therefore, we always believe you need to find the right balance between regulated and unregulated. However …80 percent of our revenues are now regulated, and our focus remains on regulated markets,” he added.