London-listed gaming solution provider Playtech has agreed an €846.0m deal to acquire Italian gaming operator Snaitech.
The company has reached an agreement with Snaitech shareholders Global Games and OI Games to acquire their 70.6 per cent shareholding in the business, which will be followed by a mandatory takeover offer for the remaining shares.
The overall transaction is expected to complete in the fourth quarter or this year and will be funded by a combination of existing cash resources and new debt facilities.
"The acquisition delivers the board’s strategic objective to improve the quality and diversification of group revenue, whilst delivering exposure to high growth end markets, by utilising the strength of Playtech’s balance sheet."
The acquisition values Snaitech at €846.0m, equivalent to an implied EV/EBITDA of 6.2x, and is expected to deliver annual cost synergies of €10.0m. The business, which merged with Italian rival Cogetech last year, generated revenue of €889.6m in 2017 with EBITDA of €132.7m.
Playtech said that the acquisition will create the first vertically integrated retail and online gaming business in the Italian market and enhance its regulated market revenue mix to approximately 80 per cent of the enlarged group’s FY17 pro-forma revenue.
The acquisition of the initial 70.6 per cent shareholding is subject to Playtech shareholder approval and receipt of any relevant approval from anti-trust authorities, as well as the consent of the Italian gaming regulator.
Commenting on the agreement, Snaitech chief executive Fabio Schiavolin said: "This acquisition reflects Snaitech’s position as one of the leading and best known brands in Italy and delivers meaningful value to our shareholders.
"The combination of Playtech’s technology and experience in Italy with Snaitech’s powerful brand mean we will be better able to capture the online opportunity in the fast growing and dynamic Italian market. We are pleased to be joining the Playtech team and look to the future with confidence and excitement."
"Playtech has always been at the forefront of its industry and the acquisition offers the opportunity to create a vertically integrated B2B2C operator in Europe’s largest gambling market, delivering significant value to shareholders," Weizer added.