Gamenet, an Italy-based gaming company, has acquired betting operator GoldBet in a deal worth €265m (£240m/$310m). The acquisition will make Gamenet the “clear leader” in traditional betting industry in Italy.
“This transaction represents a major opportunity for the two companies and will allow us to exploit the synergies and know-how of both companies,” GoldBet CEO Paola Bausano said.
GoldBet operates approximately 1000 betting shops in Italy. The firm generated earnings before interest and deductions of €40m in 2017. This will increase the number of betting points in the new entity’s fold to 1700.
Gamenet chief executive Guglielmo Angelozzi highlighted that the transaction offers the opportunity for the company to expand its services in a number of verticals.
The combined business will have a 21 per cent share of the retail betting market and a 33 per cent share of the virtual sector, with Regulus Partners’ Paul Leyland stating in an update that the deal will allow the merged entity to become a “clear leader in more traditional betting products and channels.”
However, Leyland added a note of caution regarding the internet proposition of the combined business, with GoldBet and Gamenet presently only occupying 3.8 and 3.1 per cent of the country’s online market share, respectively.
“Online the combined entity’s total market share is only 7 per cent overall and 11 per cent in betting,” Leyland stated. “This makes it a credible No.4 in betting behind bet365, SKS365 and GVC, but still stuck in the mid-tier of a stubbornly fragmented Italian online market, with neither side bringing anything to break out of this, in our view.”
The note added that overall growth in the country’s gaming sector is “being powered first and foremost by online”, notwithstanding the recently-introduced ban on gambling promotions and advertising.
However, online still represents a relatively small proportion of Italy’s commercial gambling revenue, with approximately 20 per cent of the market in comparison with 80 per cent for machines.
“Combinations with very high machine exposure and relatively limited domestic online capabilities still remain challenged, in our view,” Leyland added. “Conversely, it is telling that all of the top four online businesses in Italy – Stars, SKS365, bet365 and GVC – are online-led and none has material machine exposure.”
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