The Stars Group to acquire Sky Betting & Gaming for $4.7bn
PokerStars owner says “landmark” deal for the UK-focused operator will create the world’s largest publicly listed online gaming company
The Stars Group is to acquire UK-focused operator Sky Betting & Gaming (SBG) for $4.7bn in a deal the PokerStars-owner said will create the world’s largest publicly listed online gaming company.
The cash and stock deal is expected to be completed in Q3 2018 and will see The Stars Group acquire SBG from its current owners CVC Capital Partners and Sky, which own 71% and 20% of the company respectively.
The acquisition will provide The Stars Group with a larger foothold in the UK online gambling market, greater revenue diversification and enhanced exposure to the sports betting vertical.
Stars also said it had identified cost synergies of at least $70m per year.
Following the deal, The Stars Group’s leadership will draw from the two respective operators, with SBG’s Yorkshire base in Leeds and Sheffield operating as a major hub of the enlarged group.
The Stars Group chief executive, Rafi Ashkenazi, described the deal as a “landmark moment” for the Toronto-listed operator.
“SBG operates one of the world’s fastest growing sportsbooks and is one of the United Kingdom’s leading gaming providers,” Ashkenazi said.
He added: “SBG’s premier sports betting product is the ideal complement to our industry-leading poker platform.
“The ability to offer two low-cost acquisition channels of this magnitude provides The Stars Group with great growth potential and will significantly increase our ability to create winning moments for our customers.”
The $4.7bn deal for Sky Betting & Gaming is expected to be completed in Q3 2018
SBG, which came seventh in last year’s EGR Power 50 rankings, has witnessed strong growth in recent years to become one of the UK’s largest sports betting operators, with unaudited full-year revenue of £624m and unaudited adjusted EBITDA of £202m in 2017.
“We are delighted to join forces with The Stars Group,” said Richard Flint, SBG’s CEO.
“We have had a fantastic last few years and would like to thank CVC and Sky for supporting us in becoming a leading online operator in the UK. This transaction allows us to offer our best-in-class products to a truly global audience.”
The deal for SBG comes after The Stars Group recently bought a majority stake in Australian operator CrownBet, which itself acquired William Hill’s Australia-facing business in March.