Betsson bolsters Baltic presence with TonyBet acquisition
The deal is worth up to 6m and will see TonyBet's Lithuanian arm migrate on to Betsson's in-house platform
Betsson AB has moved to strengthen its position in the Baltics with the acquisition of sportsbook operator TonyBet’s Lithuanian business for up to 6m (£5.1m).
The Group has purchased the privately-owned operator LoÅ¡imų strateginÄ grupÄ UAB, trading as TonyBet, in a cash deal initially worth 4m (£3.4m) and is expected to be completed within a month.
The sellers are also eligible for an additional 2m (£1.7m) performance bonus in 2017 if the operator achieves certain milestones. The deal does not include TonyBet’s operations in the UK, Estonia, Denmark and its B2B division.
“We see strong synergies in this acquisition, through migration of the operator to Betsson’s technical platform, and development of the casino offering.” Ulrik Bengtsson, CEO and President of Betsson Group, said.
TonyBet’s revenue amounted to 3m (£2.5m) in the first six months of the year ending 30 June 2016, with adjusted EBIT totalling 0.55m (£0.47m).
It is the second largest operator in Lithuania and operates out of 20 betting shops in the region.
Bengtsson described the acquisition as a “good strategic fit” as the Group looks to increase its revenue from locally regulated markets.
“We have now consolidated our presence in the Baltic region by ensuring local licences in all three markets, and continue to pursue growth across Europe, organically and through acquisition,” Bengtsson added.
The deal comes after Betsson AB recently saw its Q2 profits slide after a disappointing sportsbook performance and unfavourable currency effects.
Operating income totalled SEK158.3m (£14m), 26% lower than the SEK213.8m (£18.8m) posted in the same period last year, while operating margin was 17% (25%), affected too by unfavourable exchange rate fluctuations.