Betsson acquires Georgia-facing Europe-Bet in £54m deal

Betsson AB has acquired Georgia-facing operator Europe-Bet in a deal worth up to US$85m (£54m), the firm announced this morning.

The agreement, which is expected to complete next month, will see Betsson pay Europe-Bet’s private owners $50m (£32m) up front with a further $35m (£22m) due after one year should the current regulatory framework in Georgia remain unchanged during that period.

Europe-Bet operates both online and land-based businesses, however, from total turnover of $52.4m in 2014, more than three quarters ($40.8m) was derived via its digital operation, of which 44% was sportsbook driven.

Total 2014 EBIT was $20m, with $17.9m coming from online, at a margin of 38.1%.

The deal, which implies a maximum purchase multiple of 4.3 times EBIT, will see Betsson become the second biggest operator in Georgia with Europe-Bet’s market share marginally below 30%.

News of the deal comes after eGaming Review in April revealed that Betsson had been in talks over a potential deal with Europe-Bet and had secured a period of exclusivity until the end of June.

“Europe-Bet has established a strong brand with a competitive multi-product offering in the locally regulated market of Georgia,” Magnus Silfverberg, Betsson CEO and president, said.

“Together with Betsson’s technology, a foundation for profitable and sustainable growth within and outside Georgia is created,” he added.

Betsson said the some of the Europe-Bet founders will continue in strategic positions following the acquisition while other “key” employees will be retained to operate the business.

The acquisition, which will bring the number of Betsson B2C brands to 14, will be financed through a renewal of a credit facility amounting to €35m (£25m) and a new credit facility of SEK700m (£53m).

Betsson is currently on the search for a permanent new chief executive with Silfverberg set to leave the firm following its H1 presentation on 17 July.