Lottomatica CEO says any M&A will involve “larger deals”
Guglielmo Angelozzi sheds light on Italian operator’s appetite for more M&A activity less than 12 months after it acquired fellow Italian operator SKS365
Lottomatica CEO Guglielmo Angelozzi has said the company is continuing to evaluate potential M&A deals, telling analysts the Italian operator is keeping tabs on “transformational” targets.
The operator acquired SKS365, since rebranded to PWO, in April 2024 for €639m, in what was a significant move in Italy and has helped drive Lottomatica’s online market share in Italy to 30.9% as of Q4 2024.
First announced in November 2023, Lottomatica was able to fend off interest from Flutter and Playtech to secure the Italy-facing operator, which valued the Planetwin365 parent company at 8.7x its full-year 2023 EBITDA, pre-synergies.
Just shy of a year on, Angelozzi was pressed for comment on Lottomatica’s appetite for further M&A activity, particularly the type of business it could set its sights on.
Lottomatica’s full-year 2024 report included a proposal for the board to authorise the share buybacks, which bosses said would “compete for excess cash with M&A” to deliver maximum shareholder returns.
The group’s investor deck read: “We do not sit on cash: excess cash available for capital returns and/or M&A depending on shareholder returns.”
Speaking to analysts following the release of the results, Angelozzi explained: “We continue to look at M&A opportunities, we’ve never stopped.
“We continue to look at larger deals, more transformational deals at good assets. Would that preferably be Italy or international? If we find something which makes sense and is accretive in Italy, we’ll for sure consider that.
“The main difference compared to previous acquisitions in Italy is that those had a financial sense that was super accretive, and they still can be super accretive, they also had the strategic sense.”
Lottomatica also acquired fellow Italy-facing brand Betflag in 2022 for €310m as part of its efforts to dominate the market.
Angelozzi continued by shedding light on how Lottomatica evaluates potential international targets.
He noted: “We consider them on the basis of value creation, but we also look at promising, interesting accretive international deals with a clear framework: Europe, B2C, no lotteries, regulated.
“The strong point is that we have to be able to give a price to the jurisdiction, we have to be able to see how we add value. Is that through tech? Is that through streamlining processes and costs? There has to be a clear investment case, which is on an asset-by-asset basis.
“M&A is always in our hearts; it’s in the DNA of the company. It’s not at any cost, but we keep the pipeline active for sure.”
The Lottomatica chief added that while the migration of PWO is not entirely complete, full realisation of synergies will be achieved by 2026.
“Those customers and those shops will be moved by the summer into the group tech and product, which will announce the business profile and proposition to the customer. We expect that to generate a positive momentum,” he said.
Angelozzi’s comments came soon after the release of Lottomatica’s FY 2024 performance, which included a 23% revenue rise to €2bn.
The online side of the business produced €780.2m of the topline figure, a 50% increase compared to 2023, aided by market share increases across all products and brands, according to bosses.
At the time of writing, Lottomatica’s share price has seen a marginal uptick of just under 1% to sit at €16.73.