French competition regulator approves FDJ’s £2.1bn move for Kindred Group
L’Autorité de la concurrence says FDJ’s commitment to putting distinction between existing brands and incoming Kindred Group assets are sufficient
France’s national competition regulator has approved La Française des Jeux’s (FDJ) £2.1bn acquisition of Kindred Group after the operator agreed to mitigate certain flagged risks.
L’Autorité de la concurrence has cleared the transaction following its phase one investigation, with a full disclosure from the regulator due to be published in the near future.
However, the regulator did air concerns that, should the acquisition complete, Kindred could be “commercially linked” to FDJ’s existing monopoly operations.
The competition authority said that links could be created between Kindred’s online sports betting, horseracing and poker operations in France to FDJ’s operations in those verticals.
L’Autorité de la concurrence suggested this could manifest as promoting Kindred products to existing FDJ users, using offers to encourage FDJ players to also use Kindred products and using a single account for all sites under the newly combined company.
In response, FDJ has made a commitment to separate its existing brands and Kindred Group, with concerns also flagged by third parties over a potential close meshing of the two.
L’Autorité de la concurrence said: “All competitive games will eventually be marketed under one or more brands specific to competitive games and not sharing a common root or logo with the FDJ or Parions Sport Point de Vente brands or any other brand under which FDJ markets its monopoly games in France.”
FDJ first announced its £2.1bn offer for Kindred Group in January, in a move that would create one of the largest pan-European operators in the market if it completes.
Similar concerns were also raised when FDJ snapped up French horseracing operator ZEturf last year, with L’Autorité de la concurrence approving the deal based on FDJ’s commitments.
Those commitments helped assuage conglomeration fears, based on the “nexus between FDJ’s monopoly activities and ZEturf’s online sports and horseracing betting activities”.
Similarly, FDJ introduced separate customer wallets for the ZEturf brand as part of its efforts to reduce monopoly concerns.
The decision is also subject to appeal.
In July, FDJ CFO Pascal Chaffard dismissed monopoly concerns as he pointed to the company’s experience in acquiring ZEturf last year.
The finance chief also insisted that when Kindred Group comes into the fold, FDJ will still only be the third-largest operator in France, behind Winamax and Betclic.
He also refuted a suggestion that Kindred Group’s flagship Unibet brand could be pulled from the French market.
Neither FDJ nor Kindred Group have yet to publicly comment on the decision from the regulator.