One of the U.K.’s top gaming companies is considering selling off overseas brands.
Etnain Plc hired Wall Street firm Moelis to help facilitate the possible sale of businesses that aren’t using the company’s technology platform, according to a report from the Financial Times.
Nearly one-third of Entain’s revenue from the first half of last year was generated by assets that aren’t on the company’s platform. Entain, which co-owns U.S. sportsbook BetMGM with MGM, operates in nearly 20 countries.
The Financial Times reported that Netherlands-based BetCity, Australia’s Ladbrokes, Sweden’s Enlabs, and Georgia’s CrystalBet are not on the platform and are under review.
Croatia’s SuperSport and Poland’s STS Holdings aren’t using Entain’s technology, but their success was included in highlights of Entain CEE during interim CEO Stella David’s fiscal year review.
Why the shakeup?
Entain is searching for a stronger financial hold after a tumultuous 2023, in which it reached a $737 million settlement because of alleged bribery offenses made by former leadership with a Turkish business.
That and revenue concerns led to the CEO stepping down, and the formation of a capital allocation committee. The report noted that the goal is to maximize value, and a review might not lead to selling off assets.
“The capital allocation committee is going through market by market and making some determinations,” a person familiar with the matter told Finacial Times. “It’s all about working out what market Entain wants to be bigger in and what markets are extraneous and could be sold.”
Market adjustment
Entain recently invested a lot of capital in acquiring sports betting companies, but selling off assets would help Entain adjust its focus to stronger countries.
The gaming company has lost market share in the U.K. and Germany, prompting increased investment in BetMGM and the rapidly expanding U.S. market. BetMGM saw a 36% year-over-year increase in net gaming revenue as online customers grew by 23% in 2023.
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