Playtech questions timing of new offer for Finalto division

Playtech expects to complete the sale of its Finalto financial services division as planned, despite the submission of a last-minute non-binding conditional offer from Gopher Investments.

The Hong Kong-based investment firm, which holds a 4.97 per cent stake in Playtech, submitted a US$250m all cash offer for Finalto last week, more than five months after Playtech announced that it was in exclusive talks to sell the business to a management consortium backed by Barinboim Group, Leumi Partners, The Phoenix Insurance Company and Menora Mivtachim Insurance.

The $250m non-binding conditional offer from Gopher compares to the $200m offer from the management consortium.

In its response to the latest offer, Playtech questioned Gopher’s timing and highlighted the series of announcements from its board of directors regarding a potential sale of the financial division, as well as the restrictions imposed on the company by the Share Purchase Agreement (SPA) with the consortium.

“Both Playtech and the consortium buyer are bound by the restrictions agreed as part of the SPA, which includes not engaging in negotiations with any third party regarding a potential transaction involving the sale of Finalto, as is customary for transactions of this nature, especially where they have been concluded after a long and detailed formal process and which was in the public domain,” Playtech said in a statement Friday.

“The timing at which Gopher has chosen to come forward with its indicative proposal makes it very difficult for the Playtech Board to properly assess the proposal, given the restrictions agreed in the SPA. It is unfortunate, in light of the long sale process run to date, that Gopher did not advise Playtech of its interest in acquiring Finalto at any point prior to 29 June 2021.”

The company added that the indicative proposal from Gopher is non-binding and subject to a number of conditions, including due diligence, financing, negotiation of key terms, preparation of transaction documentation and receipt of regulatory approvals, meaning that “there can be no certainty that the transaction proposed by Gopher would proceed to signing or completion”.

Playtech shareholders will vote on the offer from the consortium at a general meeting of the company called for July 15.

Shares in Playtech plc. (LSE:PTEC) were trading 0.39 per cent lower at 442.06 pence per share in London Monday morning.