Sportech to Sell its Global Tote Business to BetMakers for $41.3 Million

BetMakers Technology Group (BET), a renowned Australian betting technology company has announced its plans to acquire Sportech PLC’s Global Tote business for US$41.3 million (A$56.2 million/€34 million/£30.9 million) on a cash-free/debt-free basis. BET which is listed on the Australian Securities Exchange (ASX) will be taking over the company’s assets and IPs in Europe, Asia, the USA, and the UK, thereby making BET the new king of supplying racing and in-stadia wagering systems in the world.

Prior to this acquisition, Sportech was the leading technology specialist firm worldwide, and its Global Tote business has been supplying technology and services to gaming brands across the globe, with a specialty in the horseracing betting industry. Per the latest company report, the Bristol-based Global Tote processed a whopping $12.2 billion worth of betting handle for clientele spanning across 37 countries in the 2019 financial year ending 31st December.

A Huge Boost for BetMakers’ America Facing Business

Todd Buckingham, the Chief Executive Officer of BetMakers voiced his approval of this deal, explaining the potential that his company will have, particularly in the US horse racing market, in the following briefing; 

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"BetMakers' proposed acquisition of Sportech's Global Tote business is part of our company's international expansion plans to help power the excitement, growth and sustainability of horse racing globally. We consider the Sportech name to be synonymous with racing around the world, and we believe that BetMakers has the complementary knowledge and assets - and shared values built around a passion for racing - to help deliver ongoing success for clients, partners and all stakeholders in the racing industry.

This Acquisition will supercharge our entry into the U.S. and position the Company for substantial growth on the back of the emerging wagering opportunities in U.S. racing, including Fixed Odds, where we believe we are well placed. The Acquisition would give us a meaningful presence in the US, including in 36 of the States and across more than 200 venues, 25 digital outlets and 9000 betting terminals. It will also greatly expand our global customer base across the UK, Europe and Asia and provides us with an opportunity to expand our product offering at scale in these and other regions”.

Richard McGuire, the Sportech CEO also released a statement upon the announcement saying that; 

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"We previously set out that one of the group's transformation objectives included evaluating and executing material corporate opportunities which deliver tangible investor returns. The board believe this transaction very much achieves that objective. In addition to the range of opportunities which the net proceeds are expected to provide to the Group, we believe the BetMakers product suite will further enhance the existing Sportech platform providing additional opportunities for global gaming clients."

Shareholder’s Approval is Vital for the Deal to Materialize

For sale to push through Sportech’s shareholders must give the green light and BetMakers will also have to be granted regulatory approvals as needed for the deal to be sealed. Last month, the shareholders of Sportech turned down a $71.9 million (£53.8 million) buyout proposition from Standard General LP, a US hedge fund best known for its investment in American Apparel when it filed for bankruptcy in 2015. The shareholders rejected the deal because of fears that Sportech would end up undermining its business and prospects should it agree to the deal.

The company shareholders will commence the process of voting for the BET takeover starting 21st December and should things go smoothly, the transaction could be completed in the first half of next year.

Should the acquisition get a thumbs up from the shareholder meeting, BET will pay Sportech 20% of the consideration which is $8.23 million, as a non-refundable initial payment, and the remaining $33.07 million will be paid after the usual conditions of such a transaction are satisfactorily met. After the completion of the sale, Sportech will then be left with its lottery division, venues business, and the Bump 50:50 operations.