Entain PLC, one of the world’s largest online sports betting companies, is buying Dutch bookmaker BetCity.
U.K.-based Entain has agreed to purchase BetCity from Sports Entertainment Media for an initial cash consideration of 300 million euros (approximately US$313 million) and a deferred conditional consideration of up to EUR550 million (US$573 million), according to a press release published on Tuesday.
The latter figure is dependent on the performance of Amsterdam-headquartered BetCity, with the maximum takeover price capped at €850m ($US886 million). Entain will fund the initial payment out of its existing cash on hand and its revolving credit facility. The acquisition is expected to close in the second half of 2022.
Entain, which rebranded itself from GVC Holdings in December 2020, is the owner of the popular U.K. and European sportsbooks Ladbrokes, bwin, and Coral. It also has a significant presence in the United States via its 50% stake in BetMGM, which ranks as the number two sports betting and iGaming operator in the country after securing a 23% market share in the fourth quarter across the markets in which it operates.
Compliments and complements
With the acquisition of BetCity, Entain is continuing its long-term expansion and acquisition strategy that helped push its net gaming revenues to around US$4.7 billion in 2021.
Since its licensing in the Netherlands in October 2021, BetCity has established itself as one of the leading online sports betting and gaming operators in the country. The bookmaker was one of the first online casinos to enter the newly regulated Dutch market and had a Q4 market share of 20%.
Entain called BetCity a "highly complementary addition" to its bwin and party brands, which are awaiting approval for a license to operate in the Netherlands. That approval is now expected during the second half of the year.
"We are delighted that BetCity is joining Entain and are excited by the significant opportunities in the newly regulated Dutch market,” Entain CEO Jette Nygaard-Andersen said in Tuesday’s press release. “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."
Entain also confirmed that Melvin Bostelaar, CEO of BetCity, and other top executives at the company will remain in their current positions. For his part, Bostelaar believes the friendly takeover will enhance BetCity's ability to increase its market share.
"We are happy to be joining forces with a world-class group in Entain,” Bostelaar said in the release. “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.”
An acquisition spree
Entain is an FTSE100 company that operates both online and in the retail sector. The publicly-traded company’s holdings include Ladbrokes, Coral, bwin, Sportingbet, and Sports Interaction.
The gaming giant currently ranks second in earnings only to Ireland's Flutter Entertainment, which is comprised of Adjarabet, BetEasy, Betfair, FanDuel, Fox Bet, Paddy Power, PokerStars, SkyBet, Sportsbet.com.au, Timeform, and the TGV Network.
Entain had previously announced that it could use its excess cash reserves to carry out further acquisitions in 2022 rather than make shareholder payouts. The company posted a 31% gain in Q1 gaming revenues for the current year as a result of a sharp upturn in its retail betting shop turnover and continued gains from its BetMGM operations.
The BetCity deal also comes on the heels of Entain's acquisition of the owner of major Canadian bookmaker Sports Interaction in February for around CAD$300 million.
Meanwhile, fellow Entain brands bwin and party have launched in Ontario’s regulated iGaming market, along with BetMGM.
