The French gambling giant La Francaise des Jeux SA (FDJ) has announced its intention to buy the Swedish online gaming operator Kindred Group Plc for 27.95 billion kronor ($2.7 billion) in cash. The deal, which is expected to be completed by the end of the year, will create a European gaming champion with a strong presence in both online and offline markets.
A Premium Offer for Kindred Shareholders
FDJ’s offer of 130 kronor per share represents a premium of 24% over Kindred’s closing price on Friday, according to a statement on Monday. The offer has been unanimously recommended by Kindred’s board of directors, who consider it fair and attractive for the shareholders.
Kindred, which operates brands such as Unibet, 32Red, and Maria Casino, has more than 30 million customers across nine markets, mainly in Europe and Australia. The company reported revenues of 5.6 billion kronor ($536 million) and an operating profit of 1.3 billion kronor ($124 million) in the third quarter of 2023.
FDJ, which is majority-owned by the French state, is the leading lottery and sports betting operator in France, with more than 27 million players and a network of 30,000 points of sale. The company generated revenues of 1.9 billion euros ($2.1 billion) and an operating profit of 346 million euros ($377 million) in the first half of 2023.
A Strategic Move to Expand and Diversify
The acquisition of Kindred is part of FDJ’s strategy to expand its international footprint and diversify its product portfolio, especially in the fast-growing online gaming segment. FDJ expects the deal to generate significant synergies and value creation, as well as to enhance its growth prospects and profitability.
By combining their complementary assets and expertise, FDJ and Kindred aim to create a leading European gaming group with a balanced exposure to online and offline channels, as well as to lottery, sports betting, and casino games. The merged entity will have a presence in 18 countries, with more than 40 million customers and a pro forma revenue of 4.4 billion euros ($4.8 billion) in 2023.
FDJ’s CEO, Stéphane Pallez, said: “This transaction is a unique opportunity to accelerate our development and to reinforce our position as a key player in the European gaming industry. We are very impressed by Kindred’s achievements and we are convinced that we can create significant value together, for the benefit of our customers, employees, and shareholders.
Kindred’s Chairman, Evert Carlsson, said: “We are delighted to recommend FDJ’s offer to our shareholders, as we believe it reflects the quality and potential of our business. We are confident that FDJ is the right partner for Kindred, as we share the same vision, values, and ambition to provide the best gaming experience to our customers.
A Conditional and Regulatory Approval
The completion of the deal is subject to several conditions, including FDJ’s acquisition of at least 90% of Kindred’s share capital, the approval of Kindred’s shareholders at an extraordinary general meeting on March 15, and the clearance from the relevant competition and gaming authorities.
The offer is expected to be launched on February 20 and to remain open for a maximum period of 39 weeks. If FDJ acquires at least 90% of Kindred’s shares, it intends to initiate a squeeze-out procedure to delist Kindred from the Nasdaq Stockholm stock exchange.
The deal is financed by a combination of existing cash resources and new debt facilities. FDJ has secured a fully committed bridge financing of 2.4 billion euros ($2.6 billion) from a consortium of banks, which will be refinanced by a mix of senior bonds, hybrid bonds, and equity.
