FDJ proposes €2.6bn buyout of Kindred Group

Updated:2024-03-25 13:29    Views:181

La Française des Jeux (FDJ) has unveiled plans to acquire Kindred Group, a European gaming company operating the Unibet brand.

The proposed all-cash tender offer, valued at SEK 130 ($12.43) per share in Kindred and listed on Nasdaq Stockholm, represents a 24% premium over the closing price on 19 January 2024.

FDJ Chairwoman and CEO, Stéphane Pallez, said: “I am pleased to announce today the proposed acquisition of Kindred. Fully aligned with our strategy, it will give the Group a diversified and balanced profile, based on several pillars: the monopoly activities, mainly the lottery, on our French historical market and since November, in Ireland, with the acquisition of the Irish lottery operator PLI and online sports betting and gaming activities open to competition in Europe.”

Kindred, with brands such as Unibet and 32Red,Online Casino Games reported £893m ($1.1bn) in revenue in 2023. The combination is expected to increase FDJ's international presence to approximately 20% of its gross gaming revenue (GGR), up from the current 6%.

FDJ's acquisition of Kindred is preceded by its acquisition of Premier Lotteries Ireland in November 2023. The €380m deal aimed to strengthen FDJ's international presence as a lottery and online gaming operator. Additionally, FDJ reported €586m in revenue for Q3 2023, contributing to a year-to-date total of €1.88bn.

The proposed acquisition is supported by Kindred's Board of Directors, with five key shareholders, representing 27.9% of the capital, already committing to tender their shares. The transaction, expected to commence on 19 February 2024, is subject to regulatory approvals and FDJ acquiring at least 90% of Kindred's capital.

FDJ aims to finance the acquisition using available cash and a bridge loan with French banks. The company reiterates its commitment to maintaining a mid-term net debt to recurring EBITDA ratio of ≤2x.

The combined group anticipates significant value creation, with a more than 10% accretion in dividend per share projected starting from the 2025 financial year, to be paid in 2026.

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