Playtech to be purchased by Aristocrat Leisure
Aussie gaming giant Aristocrat Leisure is set to buy Playtech in an all cash deal worth £2.1 billion.
The offer, at 680 pence per share was announced Monday. At a generous 58% premium to Playtech’s 429 pence close on Friday 15th, the news sent shares soaring to just shy of the offer price, where they remain today (675.5 pence a share at time of writing).
Aristocrat’s share price has remained unchanged, due to a trading halt until Thursday 21st. We’ll get a better idea about what the market thinks about the offer from the other side of the fence when shares resume trading then.
It’s pretty clear from Playtech’s price trajectory leading up to the offer that this has taken the market completely by surprise.
No loose lips amongst all those involved in all the negotiations that had taken place prior to Monday. And judging by the volume offer documents already jointly published by both parties, negotiations had been taking place for some time.
Playtech’s board have unanimously agreed to recommend shareholders accept the offer. It’s already been revealed that Playtech’s largest (21% stake) shareholder is already on board. The 75% shareholder approval required for the deal to proceed would appear a fait accompli.
So subject to regulatory hurdles being passed, by mid 2022, Playtech will become part of the Aristocrat Leisure group of companies.
Aristocrat is a Sydney headquartered, Australian Stock exchange listed gaming technology provider. Slot machines (or ‘pokies’ as they’re called down under) are their bread and butter.
In addition to supplying the ravenous Australian pokies market, they supply equipment to casinos in more than 300 other gaming jurisdictions across 80 countries. Their pre-trading halt share price had gave them a market capitalisation of just under AUD 30 billion.
In Playtech they have seen a quick entry into online gambling; a leading supplier to online casinos globally, with already well established links into the burgeoning American online market.
According to Aristocrat CEO Trevor Croker,
“The business will be ideally positioned to unlock sustainable shareholder value by seizing opportunities in the fast-growing global online RMG segment as they continue to open up, particularly in North America”
Aristocrat shares resumed trading today and jumped at the ASX open…up 6.4 per cent to $48.57.
Plot just thickened on this one.
Hong Kong-based Gopher Investments, currently a 5% shareholder in Playtech, are considering a rival bid – reported to be worth in the vicinity of £3 billion.
Another week another offer. JKO Play Ltd, has indicated it is also considering throwing its hat in the ring with an offer. JKO is controlled by former F1 boss Eddie Jordan and former Scientific Games executive Keith O’Loughlin. That’s the same Scientific Games that just bought Authentic Gaming.