Flutter bids billions for Playtech's stake in a leading Italian retail gambling and betting company. We investigate what makes this company such a hot commodity and explore why Playtech would sell its "golden goose".
Listed companies are always looking for new markets and products to invest in, and the world of regulated online gambling is no different. Playtech recently confirmed rumours that it had been entertaining an offer to purchase its Italian business interests in local gambling operator Snaitech.
What Makes Snaitech a Hot Commodity?
According to a 2024 online casino report for Italy by Statista, Snaitech is the third largest gambling operator in the country, with a market share of 7.12%.
It achieves this impressive feat thanks to its massive retail footprint covering sports betting, virtual gambling, casino games and horse racing. According to a company overview by Invest Industrial:
Quote“The group operates over 1,600 points of sale dedicated to retail betting, 60,000 New Slots and more than 10,000 video lotteries. The group also enjoys a leading position in the Italian online betting and games market thanks to its strong brand awareness and proven omni-channel business model.”
The Milan-based gambling group also boasts a high-value real estate portfolio that includes three horse racing and betting tracks in Milan and Tuscany.
Why Would Playtech Sell Snaitech?
Rumours can heavily impact the price of a listed business, and with Playtech Ltd being an FTSE250 technology company, they had to address media reports that they were negotiating to sell their shares in the Italian gambling and entertainment business, Snaitech.
According to the official Playtech response, the gambling provider is currently reviewing the finer details of an agreement that would see them divested of their 70% ownership stake in Snaitech. The deal would make sense for Playtech as the proposed deal is reportedly valued at €2 billion, a remarkable return on their 2018 investment of €846 million.
While Snaitech is the company’s leading B2C product in Italy, delivering approximately €950 million in revenue in 2023, Playtech has expanded its regional holdings, acquiring SISAL, the Italian lotto and retail behemoth, for €1.9 billion.
Why Would Flutter Buy Snaitech?
Flutter is very open about its plans to grow and expand in Italy. One of the most essential aspects of Italian gambling is that Flutter can successfully attract land-based punters to its online gambling ecosystem.
It doesn’t hurt that Italy is deemed to be the second-largest European gambling market in terms of revenue, with the Agenzia delle dogane e dei Monopoli (ADM) reporting total wagers placed of €136 billion and a gross gaming revenue of €20 billion in 2022.
Then, there are the impending updates to the Italian Gambling Act and associated regulations. According to the Italian government, the amended decree aims to reorganise how gambling works in the country, impacting its licensing regime and responsible gambling requirements and increasing the cost of online casino licenses to €7 million.
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