Playtech agrees sale of Finalto financial trading platform

Playtech has been looking to refocus on its core gambling business.
Playtech has been looking to refocus on its core gambling business.

Playtech has agreed to sell Finalto to a consortium headed by the Barinboim Group.

UK.- The FTSE250 gaming operator Playtech has reached an agreement to sell its Finalto financial trading division (formerly TradeTech) for around $210m.

As speculated earlier in the year, the platform will be bought by a consortium headed by Barinboim Group with backing from Leumi Partners and Menora Mivtachim Insurance.

The deal comprises an initial payment of $185m, with $15m deferred for up to two years, plus a further $25m dependent on cash flow or other criteria after completion of the deal.

The move, which has the backing of Finalto’s management, is part of Playtech’s plan to simplify its operations and refocus on its core gaming business.

Playtech announced that it was looking to sell Finalto last August. If the sale completes early, Playtech plans to hold on to proceeds due to the uncertain trading environment caused by the Covid-19 pandemic in order to reduce net debt.  

If it completes in the fourth quarter and the outlook is clearer, Playtech will return capital to shareholders when appropriate, it said, although it will also look at opportunities to invest in the business.

Playtech’s financial trading platform had a hard time before the Covid-19 pandemic, but it proved to be an important source of revenue in 2020. 

Playtech reported revenue down by 25.1 per cent last year at €1.08bn with retail closures due to the pandemic causing a major impact

Playtech chief executive Mor Weizer said: “Playtech has a stated strategy to simplify the group and today’s announcement is the conclusion of a two-year process in which Playtech has explored all routes to maximise value and certainty for shareholders from Finalto.

“The sale also offers a good outcome for all stakeholders in the Finalto business, providing certainty for colleagues, customers and trading counterparties. The consortium has a deep understanding of the Finalto business and the markets in which it operates and we wish our colleagues every future success.

“Looking forwards, Playtech will focus on its technology led offering in B2B and B2C gambling, driven by our online expertise and supported by a strong balance sheet. We have been building momentum in our business, as highlighted by our progress over the last twelve months in key markets such as the US, Latin America, and Europe. 

“The agreements we have signed with new customers in this period further demonstrate our capability as a leading technology provider and show the type of opportunities we intend to convert in the future.”

Playtech sees strong online growth in Q1

Playtech said online growth remained strong for both B2B and Snaitech in the first quarter of the year, leading it to increase its full-year EBITDA forecast despite the continued impact of the pandemic on retail in Italy.

Weizer said: “I am delighted by the strong performance Playtech has delivered so far in 2021, despite the ongoing challenges posed by the pandemic.

“We believe that due to the hard work and dedication of our employees, Playtech will exit the pandemic stronger than ever. Looking ahead, we are confident that the simplified group and the exciting growth opportunities ahead will deliver significant value to shareholders.”

Earlier this month, Playtech’s Italy-facing B2C business Snaitech Group announced it would absorb the parent company’s HappyBet, which focuses on the German and Austrian markets.

Snaitech chief executive Fabio Schiavolin said the integration would provide HappyBet with more resources, technological infrastructure and business development experience.

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