Deal: Australia’s Aristocrat To Buy Playtech For $3.7B
The online gambling industry is hot this year, with billion-dollar deals now a frequent occurrence. The latest billion-dollar deal is Playtech, a London-listed online gambling company, selling to Aristocrat Leisure, an Australian gambling machine manufacturer.
- Aristocrat (ASX: ALL) has agreed to buy Playtech (LON: PTEC) in a deal worth £2.7bn ($3.7bn). The Australian firm will pay $2.9bn to buy all outstanding Playtech shares and assume $800mn of the firm’s debt. It’s paying 680 pence in cash per Playtech share, a 58% premium to the company’s share price before the announcement.
- Following the announcement, Playtech’s share price jerked up, expectedly. It rose 57% on Monday to hit 678 pence, just shy of the 680-pence per share acquisition mark.
- Playtech is not a gambling operator but instead develops software used by online gambling outlets. It’s strategically selling shovels in the online gambling gold rush spurred by the pandemic.
- For Aristocrat, it’s a vital acquisition, giving the company a foothold in both the online gambling software market and making physical gambling hardware. Seeing it that way, it’s no surprise the company is paying a significant premium to buy Playtech.
- To help fund the deal, Aristocrat says it’ll raise $960mn from a block share sale at a significant discount to their current trading price. The company is apparently keen on buying Playtech to partake in the booming online gambling market.