Entain snaps up the Netherlands’ BetCity
The UK’s Entain will pay up to €850m to buy the Dutch online sports betting and gaming operator BetEnt from Sports Entertainment Media.
UK.- Entain has announced an agreement to buy the Dutch online sports betting and gaming operator BetEnt from Sports Entertainment Media. Entain will pay an initial €300m in cash on completion, followed by a deferred contingent consideration of up to €550m for the operator, which trades as BetCity.
Entain itself began blocking Dutch players when regulated online gambling launched at the start of October. The Dutch regulator, the KSA, had implemented new rules targeting all operators that did not actively block Dutch players.
The UK company’s acquisition of BetEnt will grant it a presence in the newly regulated market. Its own existing Bwin and Party brands are still awaiting approval for a licence since the KSA has requested additional documentation.
BetEnt was one of the initial ten online gaming operators to gain a licence from the KSA in time to launch when the regulated market opened. Entain said that BetCity’s offer in the Netherlands would complement that of Bwin and Party once they obtain their licences.
It said that BetCity’s local expertise, brand and diverse customer-base will combine with Entain’s global scale and platform to give customers with a broad range of products, content and experiences. It expects the acquisition to complete during the second half of the year pending approval. BetCity chief executive Melvin Bostelaar will stay at the company, as will other key members of the leadership team.
Entain chief executive Jette Nygaard-Andersen said: “We are delighted that BetCity is joining Entain and are excited by the significant opportunities in the newly regulated Dutch market.
“This acquisition will provide customers with an even better experience as we combine BetCity’s local expertise and brand alongside Entain’s market leading, customer focused platform. This transaction further underpins our growth strategy of operating in attractive regulated markets. We look forward to working with Melvin and the BetCity team.”
Bostelaar said: “We are happy to be joining forces with a world-class group in Entain. Together we will be well-placed to maintain a strong market position in the Dutch market for the coming years.
“Entain’s market leading platform, technology, established brands and global scale provides a fantastic opportunity to expand and enrich our customer offering.
“Both BetCity and Entain position the customer at the heart of everything we do, with Entain’s core values and philosophy in responsible gaming, compliance and company-culture seamlessly aligning with those of BetCity. We look forward to a bright future together.”
Based on current expectations, Entain would pay a total consideration of €450m, but that could rise up to a limit of €850m depending on performance. It will make a balancing payment in early 2023 based on BetCity’s performance in the 2022 financial year. A second contingent payment will be made in early 2024 based on 10x BetCity’s EBITDA for the 2023 financial year, minus the sums already paid. A final payment of €50m will be made upon delivery of synergies and successful migration to the Entain platform.
Entain said it intened to fund the acquisition with cash and its revolving credit facility.
Kindred Group receives Dutch gaming licence
Kindred Group is the latest operator to gain a Dutch gaming licence. It had also been blocking Dutch players while it took steps to secure a licence, a process that required it to wait for a cooling-off period to pass. It’s now obtained a licence from the Dutch gambling regulator de Kansspelautoriteit (KSA) to offer online gambling and betting via its Unibet brand.
Kindred had seen a significant impact on revenue since it began blocking Dutch players. Revenue for the first quarter was down 31 per cent year-on-year.
Gross winnings revenue (B2C) was down 31 per cent to £242.4m, largely because of the block on customers in the Netherlands. Outside of the Netherlands, gross winnings were down 7 per cent (or 3 per cent in constant currency).
