Stars Group Acquires Sky Bet in Takeover
A prominent Canadian gambling enterprise, The Stars Group, is set to acquire a renowned British bookmaking business, Sky Betting & Gaming (SBG), for $4.7 billion. Owner of brands such as Full Tilt and Pokerstars, The Stars Group will access expanded sports betting opportunities while also becoming the world's largest publicly traded gambling company.
This acquisition, worth a total of approximately 3.8 billion euros, will see The Stars Group purchase the Leeds-based SBG from primarily CVC Capital Partners, who possess more than 70% of the company's shares. The financial arrangement includes a cash value of nearly 3 billion euros, with the remaining sum paid by the issuance of their own shares. The Canadians will reach a financing total of approximately 5.6 billion euros to cover both SBG debt and their own liabilities.
This takeover is projected to conclude by autumn 2018. The Stars Group's CEO, Rafi Ashkenazi, views this acquisition as a significant milestone, stating, "Post-transaction, The Stars Group will hold a much broader ambit and a highly respected global brand portfolio."
Sanctioning this engagement with SBG, Ashkenazi also asserts that the Stars Group will further establish itself in British sports betting, while the emergence of the world's most prominent publicly traded online gaming company will occur.
Enthused and appreciative, SBG CEO Richard Flint responded, "The collaboration with CVC and Sky has enabled us to become one of the leading online operators in the UK. With this transaction, we can share our top-tier products with a worldwide audience."
Expanding its portfolio in line with the key-lock principle
The primary motive for The Stars Group stems from SBG's sports betting venture, Sky Bet, as CEO Ashkenazi attests: "SBG is part of one of the quickest growing sports betting markets on the planet." He expresses the belief that Sky Bet's influence is ideal for The Stars Group's poker brands Full Tilt and primarily, Pokerstars.
Predicted to post over 700 million euros in revenue for 2017, SBG delivers exceptional gains; the company, ranked seventh in EGR's Power 50 list, boasts five core brands: Sky Bet, Sky Vegas, Sky Casino, Sky Poker, and Sky Bingo, in addition to the Oddschecker odds comparison platform. The Stars Group generally aims to extend its presence in Europe's sports betting regime.
Britain serves as a key market for legal betting, and The Stars Group has shown interest in this area for some time now. Upon acquiring SBG, the Canadian company is projected to evolve into a sizable European sports betting industry player. Reciprocally, the alternative SBG brands may gain from Stars Group's immense potential.
The Toronto-listed company enjoyed a thriving 2017 fiscal year and even announced further plans for expansion in 2018. In March, the company acquired a majority interest in the Australian bookmaker CrownBet for over 560 million AUD. Simultaneously, William Hill Australia was bought. Expansion into the UK, India, and US follow in The Stars Group's agenda.
These expansions are reaping rewards: Since acquiring the British bookmaker, The Stars Group, on the Toronto Stock Exchange, saw a boost in share prices to $29.30, translating to a market value close to $4.2 billion. Investment in SBG has increased Stars Group's stock worth on the Toronto Stock Exchange by 26% in 2018, marking a hefty annual growth of about 66%. The Stars Group continues its upward trajectory.
The Canadians are laying the groundwork for an ambitious network: In 2017, online poker, casino, and sports betting all generated revenue growth of about 29% in the fourth operational quarter. The company is venturing into new territories this
year, and the Stars Group is desirous of expanding its reach. It announced in March that it acquired a majority interest in the Australian bookmaker CrownBet for a substantial 560 million AUD. Furthermore, William Hill Australia was also bought the same month. With expansion efforts underway elsewhere, such as Britain, India, and the US, the Canadian conglomerate is poised to reaffirm its preeminence in the online gaming industry.
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