Entain agrees to acquire BetCity – M&A
Entain has reached an agreement to acquire Dutch sports betting and online gaming operator BetEnt, trading as BetCity, from Sports Entertainment Media.
Under the agreement, Entain will pay an initial €300m (£257m/$313m) in cash upon completion, with the agreement also including deferred contingent consideration of up to €550m euros.
A compensation payment will be paid in early 2023 based on BetCity’s actual performance in fiscal year 2022, with another contingent payment due in early 2024 based on 10x BetCity’s EBITDA for fiscal year 2023 , less amounts already paid.
A final conditional payment of €50 million will also be paid upon delivery of the synergies and successful migration to the Entain platform.
The total consideration payable on current expectations is €450m, although dependent on BetCity’s performance the maximum consideration is capped at €850m. Entain said it would finance the purchase with existing cash resources and its revolving credit facility.
BetCity obtained a sports betting and online gaming license from the Dutch gambling regulator Kansspelautoriteit (KSA) in October 2021 and launched soon after when the country’s market opened the same month.
Entain said BetCity’s offering would be highly complementary to its Bwin and Party brands, which are awaiting license approval to operate in the Netherlands. This is expected later this year as the KSA has requested additional documentation as part of the application process.
Entain added that the combination of BetCity’s local expertise, strong brand and diverse user base, with Entain’s global scale and platform, would provide customers with a broader product offering. , content and experiences.
The acquisition is expected to be finalized in the second half of 2022.
“We are delighted that BetCity is joining Entain and are excited about the significant opportunities in the newly regulated Dutch market,” said Entain’s Managing Director.
said Jette Nygaard-Andersen.
“This acquisition will provide customers with an even better experience as we combine BetCity’s local expertise and brand with Entain’s market-leading, customer-focused platform. This transaction reinforces our growth strategy of operating in attractive regulated markets We look forward to working with Melvin and the BetCity team.
BetCity chief executive Melvin Bostelaar – who, along with other key members of BetCity’s management team, would remain with the business if the deal goes through – added: “We are pleased to be partnering with a world class band at Entain. Together we will be well placed to maintain a strong position in the Dutch market for years to come.
“Entain’s market-leading platform, technology, established brands and global scale provide a fantastic opportunity to expand and enrich our customer offering.
“BetCity and Entain put the customer at the heart of everything we do, with Entain’s core values and philosophy of responsible gaming, compliance and corporate culture aligning perfectly with those of BetCity. We look forward to a bright future together.