2020_8_pragmatic.gif
2020_8_pragmatic.gif
2020_8_pragmatic.gif
CLOSE
× Gambling News In-Depth iGaming Calendar Connections GI Friday Trafficology GI Magazine
GGA 2020 AffiliateCon
NEWS 19 October 2016

Tabcorp, Tatts agree A$11bn merger

By Caroline Watson
Australian gambling giants Tabcorp Holdings and Tatts Group have unveiled the terms of a merger to create a A$11.3bn wagering powerhouse.

Shares in the two companies were placed in a trading halt on Tuesday morning, “pending an announcement in relation to a potential change of control transaction”. On Wednesday morning the prospect of a merger sent Tatts shares up 15.46% to A$4.145 and Tabcorp was also up 2 per cent to A$4.99 in mid-afternoon trading.

Boards of both companies unanimously settled the deal, which will effectively give Tabcorp control of the merged business.

In a pitch to its investors, the companies stated that the new combined company’s pro forma enterprise value would be about A$11.3bn, with a market capitalisation of about A$8.6bn and combined revenue of more than A$5bn.

Tatts’ Chairman Harry Boon said the merger was based on “clear industrial logic” and a “strong and tangible synergy position” creating a stronger platform to compete with wagering competitors.

Recently Europe’s top sportsbooks, including Paddy Power Betfair and Ladbrokes, have reported increased success in Australia, which has reportedly prompted the move from the Australian firms in an attempt to hold on to their market share.

Ladbrokes refrained from commenting directly on the merger, but reiterated to Gambling Insider that its Q3 figures give strength to support its view that it’s getting things right in Australia.

Subject to state government regulations, there are hopes of many in the Australian racing industry are that this merger will take racing a step closer to a national tote, including large pari-mutuel wagering pools. It is expected that the deal will create $130m in synergies which could lead to significant financial returns to the three-code industry.

After the deregulation of gambling licences in Australia, the influx of competition saw profits fall for both firms. Tabcorp Chairman Paula Dwyer commented on the merger stating it will “create a strong and diversified business that is well placed to invest, innovate and compete, both in Australia and globally”.

“Bringing together our lotteries, Keno and gaming services businesses will give us the capability to create and even more compelling offer for customers and retail stakeholders as the combination increases capability, while increasing diversification.”

Integrating the two companies is expected to take two years, across wagering, gaming, lotteries and broadcasting.

RELATED TAGS: Mergers & Acquisitions | Sports Betting
DISCUSS THIS ARTICLE
IN-DEPTH 18 February 2020
A decade to remember
READ MORE

PREMIUM CONNECTIONS
Efbet
Systems and Software
We have partnered up with deVRealm in a joint venture for the development of new gambling technology platforms. The primary ...
1xPartners
Affiliate
1xPartners is the innovative and exciting affiliate program offered by 1xBet, one of the world's leading sportsbooks and casinos. Offering ...
Newgioco Group
Systems and Software
Newgioco Group, Inc. (OTCQB:NWGI) is a premier leisure betting technology company providing regulated online and land-based gaming and sports ...
Digital Isle of Man
Legal and Jurisdictions
Digital Isle of Man is responsible for the thriving Digital sector in the Isle of Man, spanning the Island's international ...
ActiveWins
PR and Marketing
ActiveWin has ripped up the rulebook on the traditional agency prototype. Our model is based on performance - as you ...
Global Gaming Awards
Industry Awards
The Global Gaming Awards London recognise the most innovative companies and individuals of the gaming world. The Awards are powered ...
BetConstruct
Systems and Software
BetConstruct is a global award-winning technology and services provider for online and land-based gaming industry. BetConstruct's innovative and proven offerings ...
NSoft
Systems and Software
NSoft is an award - winning internationally recognized software solutions provider for betting industry. The company has more than 200 employees ...
Zimpler
Payments
Zimpler provides a complete In and Out payment solution for online services. That means we take care of identifying the ...
BBIN
Systems and Software
The Leading iGaming Software Supplier in Asia