Acquisition

RNS Number : 0664J

Playtech PLC

11 July 2013

 



Playtech plc

                                                         ("Playtech" or the "Company")                        

Acquisition

Highlights

•       Bolt-on acquisition of PokerStrategy.com
•       Consideration of €38.3 million funded from existing cash resources
•       Business complements both Playtech's poker offering and PTTS marketing division

Playtech (LSE: PTEC), the international designer, developer, licensor and provider of software and services for the online, mobile, TV and land-based gaming industry, today announces the bolt-on acquisition of Gibraltar based, PokerStrategy.com Limited and certain of its fellow subsidiaries (the "Target Group") from etruvian Holdings Limited (the "Seller").

The Target Group operates one of the world's largest poker affiliate businesses, targeting European markets and utilising an online poker school and player community to provide professional content in more than a dozen languages to attract new and experienced players and help them improve their game through tailored training content by way of video clips, professional content and tips, with the goal to ultimately increase player value. The Target Group generates income on a revenue-sharing model in respect of players introduced to its clients for a period following player sign-up.

Consideration for the acquisition, which will be funded from Playtech's existing cash resources, is an aggregate €38.3 million (subject to a working capital adjustment). The Seller is providing customary warranties and indemnities along with non-compete and non-solicitation warranties in respect of the business, staff and customers. Dominik Kofert and Enrique Guzmán, the two founders, are providing a guarantee of the Seller's obligations and will both remain with the acquired business on a consultancy basis.

The Directors believe the acquisition of the Target Group is complementary to both Playtech's PTTS marketing division and its overall poker offering, further strengthening Playtech's leading position in poker and providing a community-based model for player acquisition, which is attractive to both social and real-money players in existing and soon to be regulated markets. The acquisition will allow Playtech to further diversify its business by providing licensees with access to the world's largest independent poker community with over six million members, thereby cementing existing relationships and creating incremental opportunities for both software and PTTS marketing.   

For the period 1 January 2012 to 31 December 2012, the Target Group generated a profit before tax of approximately €19.5 million. As at 31 December 2012, the Target Group had gross assets of approximately €18.5 million and net assets of approximately €16.3 million. However, it should be noted that during 2012 and 2013, two of the Target Group's larger customers terminated their contracts, but are contractually obligated to continue to pay fees in respect of players acquired prior to termination for periods into 2015. Playtech believes that given the combination of cost and revenue synergies, the acquisition is earnings enhancing.

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For further information contact:

Playtech plc Mor Weizer, Chief Executive Officer Ron Hoffman, Chief Financial Officer c/o Pelham Bell Pottinger Adam Kay, Head of Investor Relations	[phone] [phone]
Pelham Bell Pottinger David Rydell / Olly Scott / Guy Scarborough	[phone]

Forward looking statements

This announcement includes statements that are, or may be deemed to be, "forward-looking statements". By their nature, forward-looking statements involve risk and uncertainty since they relate to future events and circumstances. Actual results may, and often do, differ materially from any forward-looking statements. Any forward-looking statements in this announcement reflect Playtech's view with respect to future events as at the date of this announcement. Save as required by law or by the Listing Rules of the UK Listing Authority, Playtech undertakes no obligation to publicly revise any forward-looking statements in this announcement following any change in its expectations or to reflect events or circumstances after the date of this announcement.

About Playtech

Playtech develops unified software platforms and content for the online and land-based gaming industry, together with providing a range of ancillary services such as marketing, hosting and CRM services.

The Group's capabilities enable the delivery of an integrated software or turnkey solution, with players accessing online, broadcast, mobile and server-based gaming terminals through a single account.

New licensees include existing online operators upgrading or diversifying their offering, land-based casino groups, government sponsored entities such as lotteries, and new entrants making their online gaming debut, particularly in newly-regulated markets.

Founded in 1999, Playtech is listed on the London Stock Exchange and has over 2,600 employees located in nine countries. Its leading gaming applications include casino, poker, bingo, sports betting, live, mobile and social gaming, casual and fixed odds games.

www.playtech.com

 

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