GVC extends Playtech olive branch
Operator says it is in discussions to secure a “long-term mutually beneficial relationship”
GVC has announced it is in talks to expand its relationship with Playtech following the Ladbrokes Coral integration.
It was previously thought GVC would move Ladbrokes Coral from Playtech onto its own platform when the existing contract expires, some time around 2021.
Playtech’s share had dipped when the deal was first announced for example.
However GVC said today it was open to extending its relationship with the provider.
“GVC and Playtech are in discussions to update the existing services agreement between the two companies, in order to secure a long-term mutually beneficial relationship.
“This would allow Playtech access to new significant brands, revenue streams and secure long term revenues, whilst providing GVC operational flexibility to realise its synergies plan.
“In the meantime, GVC will continue to honour the existing Playtech contract and maintain the positive working relationship.”
Playtech shares were up 1.7% in early trading this morning.
The announcement followed a strong interim trading update from GVC, with a 17% increase in online net gaming revenue for the first 20 weeks of 2018.
Sports betting revenue rose by 16% for the combined group with a gross win margin of 10.4%, as amounts wagered experienced a 4% uptick.
The operator’s gaming brands also enjoyed an online revenue increase of 16% with partypoker the key driver following a 41% increase for the period.
The UK operator has also upgraded its synergy prediction to £130m by 2021, up from £100m, and will now report in pounds sterling over euros.
GVC also said it was delighted with the purchase of 51% of its Georgian-facing Crystalbet business, with online gaming revenue up 83%.
Ladbrokes Coral’s online brands grew 16%cc during the 20-week period with online sportsbook revenue up 9%. UK retail revenue suffered a 5% drop-off however due to horseracing cancellations as a result of bad weather conditions.
GVC CEO Kenny Alexander said: “It is very early days since the completion of the acquisition of the Ladbrokes Coral Group, but from what I have seen so far I am excited about the opportunities and even more confident of delivering shareholder value.
“The online operations continue to grow strongly and this is before we have started to implement best in practice across the enlarged group.
“Regulatory challenges across the industry cannot be ignored but through our scale, diversification, proprietary technology and people, GVC is very well placed to continue to succeed,” he added.