Month: July 2021

Gopher went public with its $250m (£181.5m/€211m) all-cash offer just over a month after Playtech announced a deal worth up to $210m to sell Finalto to a consortium led by Barinboim Group and backed by Leumi Partners and Menora Mivtachim Insurance.

The counter-offer was submitted on June 29, but Gopher said that, in a written response received today (Friday), the Playtech board stated that “it has limited flexibility to engage with Gopher under the terms of the sale and purchase agreement that it entered into with the [Borinboim] consortium”.

Gopher, which has a stake of just under 5% in Playtech, added: “Gopher believes [it] is an unusual constraint to have allowed given the other protections in place. As such, Gopher urges shareholders to vote against the consortium offer at the General Meeting on 15 July, 2021, in order to give the board the ability to consummate a transaction with Gopher.”

It said that while it does not dispute the proposed disposal of Finalto, it believes the offer accepted by the board does not reflect the division’s growth prospects.

The deal proposed by the Borinboim consortium includes an initial up-front payment of $185m, with $15m of this deferred for up to two years.

A further $25m would be payable contingent on certain cash flow or other criteria being met by the business after the deal completes.

Gopher said that its offer represents a 47% premium on the “base proposal” submitted by the Barinboim-led consortium. This would allow Playtech to “receive proceeds with certainty and in full on completion, securing the clean break which the board has declared as an objective of the transaction”, it explained.

The counter-bid also offers a 35% premium on the guaranteed consideration in the consortium’s proposal and a 19%  premium on the maximum amount payable by the consortium.

Gopher would finance its offer from funds that are “immediately available” and would only perform “limited due diligence, anticipated to take no more than three weeks, before seeking to enter into a fully binding offer”, it added.

Playtech in March announced plans to dispose of non-core assets and simplify its business operations, with a strategic focus on its core gambling businesses. This came after seeing a 25.1% year-on-year decline in revenue to €1.08bn in its 2020 financial year.

The supplier had been evaluating its options over the Finalto business – formerly known as TradeTech – for some time, having been approached by a number of interested parties over a potential sale last year. This led to Playtech announcing in August last year that it would be open to selling the business.

In January, Playtech then revealed it was in discussions with the consortium over a possible sale.

A statement from the regulator said it had suspended the operator’s licence under Section 118(2) of the Gambling Act, amid concerns it may have breached its licence terms, and failed to comply with the standards expected of the business.

In addition, it failed to integrate with Britain’s national self-exclusion system. Integration with Gamstop has been mandatory for all GB licensees since 31 March, 2020.

PlayerFT are the operator for Fiveyards, a London-based company acting as a virtual football transfer market.

Customers can buy and sell players for real money, and also write scout reports to recommend footballers to other customers.

The suspension is with immediate effect, though customers will still be able to access their accounts and withdraw funds.

“We have made it clear to the operator that during the course of the suspension, we expect it to focus on treating consumers fairly and keeping them fully informed of any developments which impact them,” the Commission added.

The Commission, which recently appointed Andrew Rhodes as interim chief executive, recently suspended the licences of both Nektan and Lottery England Limited.

The country’s gambling regulator Spelinspektionen in July 2019 announced it was taking action against 10 licensees, handing out a number of official warnings and penalty fees in response to the breaches.

Operators were found to have offered markets on sporting events in which a majority of players were under 18, which is prohibited under the country’s gambling regulations.

Flutter’s Betfair, two ComeOn brands, Entain, Hajper, Bet365, Coolbet, Snabbare, The Stars Group Interactive and Zecure Gaming – then operated by Gaming Innovation Group, but since acquired by Betsson – were all involved in the case.

All 10 licensees appealed to the Administrative Court in Linköping but the Court sided with Spelinspektionen, ruling last April that the violations should be considered serious and warranted sanctions. 

The Court dismissed four appeals outright, but reduced the penalty fees for six and also annulled the decision in one instance, ordering the regulator to review the case. 

The companies then appealed the judgments to the Court of Appeal in Jönköping, but the Court has now dismissed eight of the appeals and reduced the penalty fee in two other cases.

Flutter Entertainment’s Betfair arm saw its penalty fee lowered from SEK5.5m (£465,832/€541,746/$642,107) to SEK4.5m. Polar, which operates the Coolbet brand, had its fee reduced from SEK650,000 to SEK600,000.

Polar was initially ordered to pay SEK700,000 by Spelinspektionen, but this was lowered by the Administrative Court in Linköping during a hearing last April.

However, all other penalty fees that were either administered by Spelinspektionen or set by the Court in Linköping last year remained in place.

As such, The Stars Group, which is now part of Flutter, will be required to pay a penalty fee of SEK10.0m. The Stars Group also failed in its initial appeal against the penalty during the Linköping Court session last year.

Bet365 also faces a fine of SEK10m after its Hillside Sports subsidiary failed with its appeal, while Cherry brand Snabbare is still required to pay SEK8m.

Snabbare had succeed in having this fee reduced from SEK 9.5m during the appeal session with the Court in Linköping.

ElectraWorks, which is owned by Entain, failed with its appeal over an SEK5.5m fine, while ComeOn, another Cherry brand, still faces an SEK5.5m fee, with this already having been lowered from the initial SEK6.5m set by Spelinspektionen during the earlier appeal session.

Haiper’s penalty remains at SEK4.0m, despite this having been reduced from SEK4.5m by the Court in Linköping, while Casinostugan, which had its fee lowered from SEK3.5m to SEK3.0m previously failed to have this reduced further.

Zecure Gaming’s penalty also remains at SEK3.0m, though this was reduced from SEK3.5m during the Linköping Court hearing.

Next year, the three racing codes – New Zealand Thoroughbred Racing (NZTR), Harness Racing New Zealand (HRNZ) and Greyhound Racing New Zealand (GRNZ) – are projected to receive $23m more in fixed distributions compared to that budgeted for the current financial year, at a total of $140m.

TAB NZ, which has a statutory monopoly on betting in New Zealand, said total distributions to sport are also set to increase with a provisional projected total of $19.7m across the next financial year, up $3.6m – or 23% – on this year’s budget.

“A number of factors have contributed to the TAB being able to provide this projected boost in distributions,” the operator explained. “These include strong financial performance across the current financial year, disciplined cost management on the back of a change in organisational direction and restructuring in 2020, and revenue uplift from improved margin performance and increased product availability.”

Last week, NZ TAB released its performance figures for May, with turnover, gross betting revenue and net betting revenue all above budget for the month.

Turnover of $211.3m was $16.5m above budget and $85.6m above last year. The strong performance against budget was driven by sport and assisted by the number of major sporting events being broadcast globally. Total gross betting revenue was $33.9m, $3.2m above budget and at a margin of 16%.

For the year to date, the reported profit is $147.2m, which is $37.5m above budget. Normalised profit is $145.4m, which is $35.7m above budget.

Commenting on the projected increase in distributions to racing and returns to sport, NZ TAB chief transition officer Dean McKenzie said: “It’s great that we’re in a position to increase our returns to the community in the next financial year.

“Last year was a challenge for all of us and like many, our organisation went through a lot of change, but we’re now seeing the positive returns from the investment made by the Government and the industry in the TAB.

“We’re excited with where we are heading and incredibly proud that significant tangible benefits from all the hard work over the last two or three years are now starting to flow to both racing and sport in New Zealand.”

Ultimate Tournament will work with ESIC to investigate suspicious betting activity across its betting platform, as well as endorse ESIC’s campaign against match-fixing and betting fraud within the esports betting sector.

The esports betting platform provides odds data covering more than 3,000 matches sourced from 40,000 markets and 100,000 selections per month.

“Esports is undeniably a rapidly growing industry and, as a US-based gaming operator, match integrity and customer protection are of the highest concern for us,” Ultimate Tournament co-founder and chief executive Alex Pickett said.

“In order for esports to grow, and for users to have the safe experience they deserve, we believe it is imperative to work together as an industry to set a standard for fair play, and to enforce those standards universally.”

ESIC commissioner Ian Smith added: “Our anti-corruption supporters play an important role in our mission to deter cheating and fraudulent activity within betting. 

“By joining ESIC, Ultimate Tournament has displayed its commitment to playing its part in maintaining the integrity of esports. We look forward to working with Ultimate Tournament to investigate suspicious betting activity, and curb cheating and betting fraud within esports.”

The news comes after ESIC this week also welcomed the New Zealand Esports Federation (NZESF) as a new member. 

The regulator’s analysis of player habits showed that 40% of bets placed in 2020 came on Saturday and Sunday (22% for Saturday and 18% for Sunday), corresponding with the days when most European football leagues play their fixtures. This trend has remained consistent for the last seven years.

Furthermore, the research showed that slot machines were the most popular at the end of the month, when citizens are usually paid.

Last year, Friday 28 February was the day when most money was spent in slot machines across the country.

The most popular time to play slots appeared to be between 3pm and 4pm, on account of gaming venues closing at 7pm.

Spillemyndigheden director Anders Dorph said: “Market analyses such as this are one of the Danish Gaming Authority’s most important tools for ensuring a fair and well-regulated gaming market for Danes. 

“When we follow the development in game consumption and game patterns, we can be even more effective in our supervision of the game providers who have a Danish license. ”

Spillemyndigheden stressed the importance of monitoring gaming habits within the market, where channelisation reached a record high of 90% last year.

With regards to slot gaming, the figures show a steep decline in activity during the spring of 2020 and December of the same year, following Covid-19 restrictions.

The effects of the restrictions were felt by the likes of Danske Spil, which experienced a drop in revenue and profits towards the end of 2020.

Despite record takings from the online sector, the land-based shut down caused by the pandemic contributed to a 15.3% drop in revenue for the first quarter of 2021.

In the wake of the Dutch government giving live events the go-ahead, the super-affiliate will hold the ceremony at the show in September.

Naomi Barton, portfolio director responsible for iGB Live! and iGB Affiliate Amsterdam, said the relaxation in regulations is being welcomed by all sections of the industry.

“Better Collective is just one of the brands aiming to make a big impression at iGB Live!/iGB Affiliate Amsterdam and using the platform both events provide to reconnect with the igaming industry after such a long time.”

Over the past few months, the Netherlands has seen a reduction in Covid cases allowing regulations to finally ease, a welcome surprise to the igaming and affiliate communities after last year’s iGBLive! was postponed.

The news comes as the Dutch government confirmed new regulations sanctioning the use of an entry pass which uses the CoronaCheck app to confirm whether a visitor has either tested negative for, been fully vaccinated against, or has recovered from Covid-19.

Implementing the pass enables live events to take place without social distancing or the mandatory use of face coverings and also means that pre-Covid capacity levels will apply.

She added: “The entire industry will be focused on Amsterdam, including businesses from the land-based sector wanting to meet with the main igaming players in order to explore diversification strategies and opportunities to deploy their brands online.

“There’s huge pent-up demand in the industry and the latest developments to come out of the Netherlands are helping to build a real sense of momentum.”

Shona O’Donnell, head of strategic events at Better Collective, added: “We are delighted to receive confirmation that iGB Live! will take place as scheduled in Amsterdam. As the first whole-industry in-person event it will be an important milestone for the igaming community.

“Because of the significance of this event we are also delighted to confirm that we will be hosting the first multimarket Better Collective Bookmakers Awards 2021 on 28 September in connection with iGB Live.”

To register for iGB Live! and iGB Affiliate Amsterdam visit: www.igblive.com

Adjusted gross revenue was up from $11.4m in April and was also the highest monthly total since the market opened on January 21.

While more than $1.0bn has now been spent on sports betting since launch, the state’s handle declined for the second consecutive month to $227.0m. This was down 4.0% from $236.4m in April and the lowest full monthly total to date.

Players won a total of $203.8m from sports betting in May, while the state generated $2.4m in taxes.

Some $2.3m of tax collected in May was distributed to the General Fund Allocation, while the remaining $59,528 wase sent to the Problem Gambling Treatment and Support Fund Allocation.

Read the full story on iGB North America.

Unibet operator Kindred has been the largest shareholder in Relax since 2013, with a 33.4% holding in the supplier. It will now pay approximately €295m to buy out the remaining 66.6% of shares.

This €295m will be split into an initial consideration of €80m, plus two earn-out payments capped at €113m and payable in 2022 and 2023. The earn-out consideration is subject to Relax meeting certain earnings targets.

Kindred, which said the acquisition would accelerate its strategy to increase its focus on product and customer experience, plans to finance the transaction via existing cash and credit facilities.

“Through this acquisition we add a rapidly growing and profitable B2B business with a world-class product portfolio, giving us greater control over our casino, poker and bingo offering, putting Kindred in a significantly better position to achieve our long-term strategy to increase our focus on product differentiation and customer experience,” Kindred chief executive Henrik Tjärnström said.

Founded in 2010, Relax develops online casino games, supported by an open distribution platform for third-party aggregation as well as proprietary poker and bingo products.

Employing approximately 240 staff four main hubs in Malta, Estonia, Sweden and Serbia, Relax currently supplies poker and bingo content on an exclusive basis to Kindred.

In the 12 months to May 2021, Relax generated €25m in revenue, while its earnings before interest, tax, depreciation and amortisation (EBITDA) reached €10m. 

Kindred’s intention is for Relax to run as an independent entity within the group, with a separate board of directors and management team. Kindred would also continue to invest in Relax to strengthen the supplier’s position in the market by further strengthening its product offering and broadening its B2B customer base. 

All existing employee share option programs in Relax Gaming would be exercised, while the Relax management would retain an ownership of around 7% of fully diluted shares in the supplier, leaving Kindred’s ownership in Relax at 93%.

The acquisition is expected to generate annual run-rate synergies of €8m in the next three years, with Kindred hoping to complete the deal by the fourth quarter of this year, subject to customary regulatory approvals.

“Joining Kindred Group comes as a natural next step in our long-standing cooperation with Kindred across all our product verticals. Kindred’s strengthened presence will allow Relax Gaming to further invest in and accelerate the expansion of our B2B offering across the globe,” Relax co-founder and chairman Patrik Österåker said.

“We will continue the Relax Gaming journey as a separate B2B entity with unchanged product portfolio and overall strategy, staying true to our values and respecting the hard-earned trust of our customers.”

Lesson #21: Social slots will never die

Most of you reading this weren’t part of the process when social slots just began. It’s hard to understand today how big of a revolution this was. 

Here’s a secret: Even the top people in Slotomania, which skyrocketed beyond belief, couldn’t believe it was happening while it was happening. 

The top question on people’s minds was: Why would people ever pay for a slot game where they can’t collect any money? 

There were people who believed Playtika was some kind of shady money laundering business and that that was the reason for the exit. 

But Playtika’s income, of course, was real. The exit to Caesars was real. Five million monthly players (at the time) were real, they were coming back for more, and it was still going viral.

Attitudes changed over time, but some believe social slots are a fad. 

We must remember to take a look at the millions and millions of players who have been playing these games for almost a decade now, and at how many hours a day they play. 

Slots fulfil a need, but so do social slots. It is, however, a different need. 

Social slots may change over time, but once they’ve been invented, made profitable, and played, they will never die.

Lesson #22: The dangers of auto spin in new social slots

My advice to most new social slot games is: Take out your auto spin button until you become popular. Here’s why.

Auto spin sounds like a good thing. People can play more spins. People can play more even when they go to the bathroom, prepare food, watch TV, or forget about the game altogether. 

The more they play, the more they lose, and so the more they pay. 

Also, it’s a big hassle to constantly press SPIN, SPIN, SPIN, and maybe it turns players off. 

If you’re a real-money slot, absolutely keep it in from the start. 

However… When you’re a young social slot, what you really want is not for the player to lose money. What you want is engagement! You HAVE to keep the players engaged. You have to force them to look at the screen to play. To get used to the game, to find that they like it, and eventually to find that they can’t leave it. 

What you don’t want for them is to try a new game, press a button, then step away for 30 minutes. That does you no good. 

Lesson: New social slots should only put in an auto spin button after they’ve become big and have enough veteran players to warrant that button. 

Guy Hasson worked for Playtech for three years before becoming Playtika’s content manager, responsible for the content of Slotomania and Caesars Casino. He is now a social slot consultant, specialising in game popularity.