French competition regulator approves FDJ’s Kindred acquisition
FDJ has been warned not to promote commercial products to lottery customers.
France.- The French competition regulator l’Autorité de la Concurrence has given the green light to the lottery operator FDJ’s proposal to buy Kindred Group. FDJ announced a €2.45bn bid for the Swedish online gambling operator last year in a move that would create the second-biggest gambling group in Europe.
As a result of the approval, La Française des Jeux has brought forward the acceptance period for the deal from November 19 to October 2, meaning that the acquisition is likely to close sooner than expected.
In its report, l’Autorité de la Concurrence warned that FDJ must not cross-sell its commercial gaming products to French lottery customers. This echoes the conclusions reached on FDJ’s acquisition of the horse racing betting operator ZEturf.
FDJ has pledged to keep the brands apart, with separate websites and player databases. As such, players would still need to create separate accounts with FDJ and Kindred brands like Unibet. It said French customers using Kindred brands would be unlikely to see any change as a result of the takeover.
Conditions for the deal mean that FDJ cannot own more than 90 per cent of Kindred’s total shares. Five major shareholders have already made irrevocable commitments to tender their Swedish Depository Receipts to the offer: Corvex Management, Premier Investissement SAS, Eminence Capital, Nordea and Veralda. The latter directly sold a 1.11 per cent share to FDJ in March.
FDJ’s growth into a European gambling giant
The bid for Kindred is the latest in a string of deals for the former state-controlled lottery operator. It has also entered the payments space domestically while, internationally, it has added the Irish National Lottery operator Premier Lotteries Ireland to its growing portfolio.
FDJ’s revenue for the second half was up 11 per cent year-on-year at €1.4bn following its acquisitions of Zeturf and PLI. Online betting and gaming revenue was up 15 per cent €294m thanks to favourable sports results. Group EBITDA was up 23 per cent to €370m.
The acquisitions helped boost digital revenue, which rose 40 per cent to €201m (up 25 per cent like-for-like). The digital segment represented 15 per cent of all revenue. Meanwhile, the FDJ lottery unit’s income was up 5 per cent at €958m on the back of new instant win games and attractive EuroDreams and EuroJackpot draws. The company noted that its Amigo retail network returned to full technical capacity at the beginning of June.
