Playtech finally agrees Finalto sale in $250m deal
London-listed supplier finalises agreement with Gopher Investments in streamlined operational strategy
The protracted saga relating to the sale of Playtech’s financial trading division appears to have finally reached a conclusion after the supplier entered into an agreement with Gopher Investments.
Playtech has accepted Gopher’s $250m cash purchase price for Finalto, which represents 28x 2019 adjusted EBITDA to mark the last full year of trading before the Covid-19 pandemic hit.
For the first half of the 2021 financial year, Finalto generated an adjusted EBITDA loss of $0.6m.
The disposal of Finalto is part of Playtech’s strategy to simplify the group and unlock significant capital by focusing purely on its tech-led offering in its core B2B and B2C gambling markets.
The transaction is expected to complete in H1 2022, subject to standard timetables relating to regulatory clearances.
The sale of Finalto was an extended process, which saw Playtech shareholders vote against a rival bid from venture capital firm Barinboim Group worth $210m in August.
Playtech will still have to pay a break fee of $8.8m to the Barinboim Group consortium upon the completion of the transaction after cancelling their previous agreement.
Mor Weizer, Playtech CEO, said: “We are very pleased to have successfully reached an agreement with Gopher regarding the sale of Finalto.
“This transaction delivers on our strategy to simplify the group to focus on the high-growth B2B and B2C gambling markets.
“I would like to thank everyone at Finalto for their tremendous contributions to Playtech and wish them every success.
“We are pleased to recommend this transaction to our shareholders, and we remain well placed to capitalise on the exciting market opportunities ahead, driving sustainable growth for the benefit of all our stakeholders,” he added.
Playtech’s share price spiked this morning following the announcement reaching 475.40p in early trading up from a previous close of 456.80p.
Peel Hunt analyst Ivor Jones said of the sale: “The sale of Finalto should achieve an important simplification of Playtech and release material capital to be returned to shareholders; 53p per share if all of the disposal proceeds were to be returned.
“Post completion Playtech will be a leading B2C gambling technology company with global exposure to licensees big and small and the leading B2C gaming operator in Italy.
“We would welcome further structural change, but this announcement is an important step,” he added.